Jhunjhunwala stock: This Rs 3,400-crore bet tanked 38% in 12 months; Buy, says Antique

Antique Stock Broking on Tuesday said it remained positive on Concord Biotech Ltd, despite near-term headwinds, citing the company’s strong positioning as a fully integrated player and multiple medium-to-long-term growth levers. The Jhunjhunwala family via three trusts held 24.09 per cent stake in this company as of September 30, 2025. This stake was valued at Rs 3,374 crore, as per pre-open share price today. The stock is down 38 per cent in the past one year.  

Antique said it met Concord Biotech’s management, which highlighted the company’s growth prospects and execution capabilities. The brokerage noted that recent volatility in near-term revenue was largely timing-driven and did not indicate any loss of market share or demand. The management, Antique said, expected the current API to formulations mix of around 80 to 20 to remain broadly stable going forward.

Antique said it expected Concord Biotech to deliver revenue, Ebitda and PAT CAGR of 18 per cent, 17 per cent and 19 per cent, respectively, over FY25 to FY28, with margins remaining stable at around 42 per cent. The brokerage said the stock is trading at about 22 times FY28E EPS and continued to value the company at 25 times FY28E EPS, resulting in an unchanged target price of Rs 1,520. Antique maintained a 'Buy' on the stock, citing attractive valuations and strong long-term fundamentals.

Antique said execution in the CDMO segment had slowed temporarily due to uncertainty in the US market and trade-related issues, which made innovator and generic players cautious about committing volumes. However, the brokerage said the management expected CDMO to emerge as a meaningful growth driver over the next three to five years once visibility improved. 

Injectables were highlighted as an underappreciated lever, with WHO approvals enabling domestic sales and contract manufacturing, and providing a clear pathway towards in-house production and institutional participation over the medium term.

Given continued near-term headwinds that weighed on sales in the first half of FY26, Antique said management expects challenges to persist in the near term. As a result, the brokerage cut its FY26 and FY27 EPS estimates by 13 per cent and 5 per cent, respectively. 

Despite the earnings downgrade, Antique said it remained constructive on Concord Biotech’s medium-to-long-term outlook, supported by its fully integrated business model across APIs, oral formulations and injectable formulations, and its ability to capitalise on tender-driven opportunities.

Antique said Concord’s API business continued to be the primary profit engine, with a significant portion of production consumed internally for formulations and captive requirements. Underlying API growth was estimated at around 10 per cent year on year, driven by steady demand in immunosuppressant and oncology APIs. The brokerage said incremental growth could accelerate to around 25 per cent CAGR with the addition of second-source customers and better utilisation of the Unit 3 facility at Limbasi.

Antique noted that Unit 3 had an installed capacity of 800 cubic metres, expandable to 1,200 cubic metres. The unit currently generated revenue of about Rs 200 crore and had a potential to scale up to Rs 1,200 crore to Rs 1,300 crore. API margins were described as structurally strong due to limited global competition, with only five to six players worldwide and most competitors, barring Biocon and Teva, based in emerging markets.

Antique said CDMO project execution had slowed due to uncertainty around trade agreements and tariff clarity in the US. However, management expected meaningful traction once trade-related uncertainty eased, after which CDMO and injectables growth could accelerate materially. Over the next two years, the company planned to participate in institutional and tender-based business and undertake contract manufacturing for other Indian pharmaceutical companies, which could improve capacity utilisation.

On injectables, Antique said Concord Biotech had received WHO approval for its facility, enabling it to market products domestically. The company already had a front-end presence in injectables and planned to transition from third-party manufacturing to in-house production of existing marketed products over the next two to three years. CDMO was expected to represent a Rs 400 crore opportunity over the next three to five years.