Shares of Zydus Wellness surged more than 6% on Thursday, hitting a high of ₹483.40 before settling up about 2% at ₹465.50.
Why the stock jumped
Motilal Oswal started covering Zydus Wellness with a “Buy” recommendation and set a target price of ₹575. That suggests the stock could rise roughly 35% from its closing price of ₹424 on Dec 30.
What the brokerage highlighted
- The company sells a mix of health and nutrition products such as Sugar Free sweeteners, Glucon‑D glucose powder, Everyuth skin‑care, Nutralite spreads, Nycil prickly‑heat powder, and Complan drinks.
- Recent purchases like Naturell (maker of RiteBite Max Protein) and Comfort Click (a VMS brand) add high‑protein snacks and digital‑first nutrition to its lineup.
- These products match global trends – low or no sugar, higher protein, preventive health and on‑the‑go nutrition.
Growth expectations
Motilal Oswal expects Zydus Wellness to grow its earnings before interest, tax, depreciation and amortisation (EBITDA) at about 14% per year organically and 36% overall (including acquisitions) from FY 2025 to FY 2028.
Valuation and risk‑reward
The stock trades at around 22 times earnings (P/E) and 16 times forward EV/EBITDA for FY 2028, which is roughly a 30‑35% discount compared with other fast‑moving consumer goods peers. With a 70% promoter holding, experienced management and exposure to fast‑growing health categories, the broker says the stock offers a strong risk‑reward profile.
Recent performance
- Up more than 9% in the past five trading days.
- Gained over 7% in the last month.
- Rises about 15% over the previous six months.
Currently the market cap is about ₹14,793 crore and the P/E ratio sits near 45.
Takeaway
Motilal Oswal believes Zydus Wellness is well‑positioned to capture health‑focused consumer trends and could see faster earnings growth than in the past. The “Buy” rating and ₹575 target reflect that optimism.
Remember, this is just one perspective, not a prediction. Do your own research before making any investment decisions.