Choice Institutional Equities has issued a target price of Rs 1,010 for Granules India, highlighting the company’s shift toward high-margin products like oncology and complex generics. While the firm reported 20% revenue growth in FY26, investors are closely monitoring the ongoing regulatory review at the Gagillapur facility as a key risk factor.
Choice Institutional Equities has set a target price of Rs 1,010 for Granules India, reflecting confidence in the company’s ongoing transition toward a value-added pharmaceutical business model. As of October 1, 2026, the company’s shares were trading at Rs 821.75, placing the stock well within its 52-week trading range of Rs 510.90 to Rs 923.65.
The brokerage’s report highlights the company’s 'Granules 2.0' strategy, which moves the business away from a traditional, volume-driven approach. Instead, management is prioritizing high-margin categories, including controlled substances, complex generics, and oncology treatments. The company is also expanding into peptide-based contract development and manufacturing, known as CDMO services, which it expects will become a significant growth driver in the coming years.
Financially, the company has demonstrated strong momentum. For the fiscal year 2025-26, Granules India reported consolidated revenue of Rs 53,656 million, representing a 20% year-on-year growth. Operating performance also improved, with EBITDA reaching Rs 11,851 million, a 25% increase compared to the previous year. The company’s balance sheet is expected to be supported by incoming warrant proceeds, which management expects will help it maintain a healthy cash position.
Despite these positives, the company faces distinct operational challenges. A critical monitorable for shareholders is the status of the Gagillapur manufacturing facility. The unit has been under the US Food and Drug Administration's (USFDA) scrutiny following a warning letter issued in February 2025. Remediation work at this site is currently ongoing. Any potential delay or further regulatory hurdles at this facility could impact product approvals and, consequently, affect revenue growth.
Investors should also track how effectively the company manages its profit margins. While the shift to high-value products is a strategic long-term move, the actual conversion of these segments into higher profit margins will be essential to meeting performance targets. Additionally, the successful scaling of the newer CDMO business is another area where execution will be key. The market will continue to look for updates on the Gagillapur facility’s regulatory status and progress in the specialized product pipeline in the upcoming quarters.