Target: ₹1,120
CMP: ₹886
We recently visited Innova Captab’s newly commissioned Jammu facility and interacted with the management on Jammu’s growth trajectory, future drivers and outlook. The company’s Jammu facility is spread across 11 acres and has four blocks – three dedicated to Anti-biotics and one general block. With commercialisation of Jammu, the company can now produce Penicillins, Penums, Large volume parenterals and respiratory respules.
Innova Captab has increased its cephalosporin (ceph.) capacity. This will enable the company to increase its market share (5-6 per cent now, in our view) in Oral ceph and incrementally cater to export markets as domestic production shifts from Baddi (EU-GMP certified) to Jammu. The management believe that Jammu can deliver a topline of ₹400-500 crore in FY26 and can ramp-up to ₹1,400-1,600 crore at optimal utilisation.
The Jammu facility ramp-up will facilitate a Revenue/EBITDA/PAT CAGR of 34/39/41 per cent over FY25-27. With a 20 per cent+ ROIC, moderate working capital needs, strong OCF-to-EBITDA ratio and robust growth profile. We keep our estimates unchanged for the company and value the company at 25x Mar’27 EPS to derive a TP of ₹1,120.
