ICICI Direct says the slump in API prices that has hurt Akums Drugs’ contract‑manufacturing business is finally easing.
The lower API prices had slowed the CDMO (contract development and manufacturing) segment for several quarters. With prices now stabilising, the firm expects CDMO revenue to grow at a modest single‑digit rate in the second half of FY2026.
Akums has landed two big overseas deals:
These contracts should lift overall revenue growth to roughly 14 % each year from FY26 to FY28 and also improve profit margins.
Because of the better margins, ICICI Direct raises its earnings‑per‑share (EPS) estimates by around 4 % for FY27 and 20 % for FY28.
The stock trades at a price‑to‑book value of about 1.9 × for FY27 and 1.6 × for FY28, which the analysts consider attractive given Akums’ strong position in Indian pharma manufacturing. They keep a “Buy” rating and lift the price target to INR 600 (previously INR 565).
Stabilising API prices, new export deals and higher margins are set to boost Akums Drugs’ growth and profitability over the next few years.
Remember, this is just an analysis, not a prediction. Do your own research before making any investment decisions.
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