Zydus Lifesciences shares soar 7% to fresh record high after Q4 results. Should you buy, sell or hold?

Shares of Zydus Lifesciences jumped more than 7% on Wednesday to hit a fresh 52-week high of Rs 1,091 apiece on the NSE after the pharma company reported a 9% year-on-year (YoY) increase in consolidated net profit to Rs 1,272.5 crore for the January-March quarter of FY26, up from Rs 1,171 crore in the corresponding period last year.

While the bottom line grew 9%, the company’s revenue from operations rose more than 16% YoY to Rs 7,587 crore during the quarter under review, compared with Rs 6,528 crore in the year-ago period. Its EBITDA, meanwhile, grew over 20% YoY to Rs 2,554 crore in the fourth quarter of the financial year ended March 31, 2026, while the EBITDA margin improved to 33.7%.

Along with its Q4 results, Zydus Lifesciences announced its biggest-ever share buyback worth Rs 1,100 crore at a buyback price of Rs 1,150 per share, offering nearly a 13% premium over the stock’s previous closing price. The company said its board had approved a plan to buy back up to 95.65 lakh shares, each with a face value of Re 1, representing 0.95% of the company’s paid-up equity share capital, for an aggregate amount not exceeding Rs 1,100 crore.

The buyback will be conducted via the tender route. The record date to determine shareholders’ eligibility for the buyback has been fixed as May 29.

Zydus Lifesciences also said its board of directors has recommended a final dividend of Re 1 per share (100%) on a face value of Re 1 each, subject to shareholders’ approval at the company’s Annual General Meeting scheduled for August 11.

Nomura on Zydus Lifesciences
Nomura maintained its “Buy” rating on Zydus Lifesciences with a target price of Rs 1,140 per share, implying an upside potential of nearly 12% from the stock’s previous closing price.

The international brokerage said the company’s Q4 PAT was 27% above its estimates, while sales and EBITDA exceeded expectations by 4% and 15%, respectively. Zydus incurred a one-time expense of nearly Rs 4 billion during the quarter related to the Mirabegron settlement. Adjusted for this, PAT came in 58% above Nomura’s estimate, aided by forex gains and a lower tax rate.Nomura noted that growth across key business segments remained strong and exceeded expectations. “The guidance and outlook for FY27F were positive, in our view,” it said.

Nuvama on Zydus Lifesciences
Nuvama upgraded Zydus Lifesciences to “Hold” with a target price of Rs 1,050 per share. The brokerage said the company’s earnings beat estimates across most metrics, with the rating upgrade driven by improving business mix through biosimilars, specialty assets, MedTech and CDMO.

“Zydus’ strong performance was led by growth in the US, Europe, emerging markets, consumer wellness and MedTech segments. The US base at $323 million remained strong despite a decline in gRevlimid. Zydus has guided for a US revenue base of over $300 million per quarter with single-digit growth in FY27E. The US business is expected to benefit from Rolvedon, Beizray, gCopaxone and the likely launch of gJynarque. We are building in flattish US revenue in FY27E/28E. International business growth is guided at 40–45% in FY27E,” Nuvama said.

The brokerage added that Zydus remained optimistic on Desidustat in China and US launches of Saroglitazar and Nufymco (Ranibizumab), with the specialty business expected to see a material ramp-up in FY28.

Motilal Oswal on Zydus Lifesciences
Motilal Oswal maintained its “Neutral” rating on Zydus Lifesciences with a target price of Rs 1,080 per share, implying an upside potential of 6% from the stock’s previous closing price.

The brokerage highlighted that the company delivered a better-than-expected Q4 performance, with revenue, EBITDA and PAT beating estimates by 9.5%, 19% and 11%, respectively. Revenue traction in the US and emerging markets was stronger than expected, while domestic formulation and consumer wellness revenue remained largely in line with estimates.

“We raise our earnings estimates by 5% and 4% for FY27/FY28, factoring in increased traction in limited-competition products in the US, industry-beating performance in domestic formulations and other emerging markets, higher R&D spending, and enhanced marketing efforts. Considering a higher FY26 base, we expect a 7% earnings CAGR over FY26–28. The current valuation provides limited upside and hence we maintain a Neutral rating,” the brokerage said.

JM Financial on Zydus Lifesciences
JM Financial maintained its “Reduce” rating on Zydus Lifesciences but raised its target price to Rs 970 per share, implying a downside potential of nearly 5% from the stock’s previous closing price.

The brokerage said the company reported strong Q4 earnings that exceeded expectations. “Despite multiple new launches, US growth could remain challenging as gRevlimid and Mirabegron, which contribute around 36% of US sales in our view, are expected to face sharp erosion amid rising competition. The resulting revenue and margin gap is unlikely to be fully offset by new launches,” it said.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)