Buy Abbott India; target of Rs 33500: ICICI Securities

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • Abbott India's core brands, such as Cremaffin Plus, Vertin, and Duphalac, are driving revenue growth, with a 15-17% growth rate expected, led by price hikes and dominance in therapeutic categories.
  • The company's partnership with Novo Nordisk for Extensior provides an opportunity to strengthen its presence in the growing GLP-1 market.
  • Operating leverage and better product mix are expected to support EBITDA margin improvement of ~280bps to 30.4% by FY29E.
  • Healthy cash generation of ~INR 52bn over FY26-29E could be used to reward shareholders with high dividends or M&A.

Thesis Validation Checklist

  • Investors should watch for sustained growth in established brands, new product introductions, and price increases, as well as operating leverage and margin expansion.
  • Key downside risks include discontinuation of brands by Novo Nordisk and addition of key drugs to the National List of Essential Medicines (NLEM).