$CIPLA

Cipla climbed 3.05 percent to close at Rs 1,461.90 on Monday, outperforming amid broad-based buying in pharmaceutical stocks ahead of the company's first-quarter FY27 earnings, scheduled to be announced on July 23. Analysts expect Cipla to deliver a sequential improvement in its June-quarter performance, although year-on-year growth is likely to remain under pressure due to a high base in the US business following the loss of gRevlimid and lanreotide sales. The domestic business is expected to remain a key growth driver. Analysts anticipate strong momentum in the One India segment, aided by Cipla's distribution agreement with Pfizer for select brands, the launch of tirzepatide under licence from Eli Lilly, and the acquisition of Inzpera Health Sciences. Together, these initiatives are expected to provide a meaningful boost to the company's India revenues. The North America Generics (NAG) business, however, is likely to post a year-on-year decline in revenue owing to significantly lower gRevlimid sales and the absence of lanreotide injection supplies. Despite this, Nomura expects the segment to recover sequentially from the weak base of the March quarter, supported by the launch of generic Ofev, where Cipla is estimated to hold around a 50 percent market share. Investors will also closely monitor management's commentary on capital allocation and future investment plans. With a net cash position of Rs 105 billion, Nomura believes Cipla has deployed relatively less capital compared with its peers, making its strategy for cash utilisation a key area of focus during the earnings call.