JM Financial Sees 67% Upside in Piramal Pharma Stock Due to Multi-Million Dollar Deal with NewAmsterdam Pharma.

JM Financial predicts a 67% upside for Piramal Pharma, citing four reasons: a multi-million dollar deal with NewAmsterdam Pharma, product potential for Obicetrapib, a partnership that goes deeper, and financial impact from FY27. The deal is expected to enhance Piramal's global OSD capabilities, reinforce its integrated US-India network, and boost revenues and margins.

JM Financial has given a ‘Buy’ rating to Piramal Pharma, setting a target price of Rs 313 per share, which implies a potential 67% upside from the current market price. The brokerage firm's bullish outlook is based on four key reasons: a major US deal with NewAmsterdam Pharma, product potential for Obicetrapib, a deepening partnership, and anticipated financial impact from FY27.

The deal between Piramal Pharma Solutions (PPS) and NewAmsterdam Pharma is a significant milestone. PPS will support the commercial production of NewAmsterdam’s fixed-dose combination (FDC) of Obicetrapib and Ezetimibe, enhancing Piramal’s global OSD capabilities and reinforcing its integrated US-India network [1].

Obicetrapib, a novel CETP inhibitor under development by NewAmsterdam Pharma, has shown promise in Phase 2 and 3 trials. When combined with Ezetimibe, it offers a powerful non-statin alternative for patients not adequately treated by current drugs. The fixed-dose combination has a market potential of USD 1–2 billion once commercialized [1].

This collaboration is not Piramal's first with NewAmsterdam. Piramal's integrated global network has already supported Obicetrapib’s development, with its Ahmedabad site playing a critical role in formulation work and the Pithampur site providing dual sourcing to ensure supply chain resilience [1].

The brokerage expects the deal to start reflecting in numbers by FY27. With Piramal likely to be the exclusive supplier, revenues and margins are expected to get a strong boost. The project is expected to enhance the US business profitability, with margins upwards of 30%. The contributions from the tie-up are expected to materialize from FY27 onwards and have USD 50–100 million annual top-line potential for the first three years [1].

JM Financial has revised its estimates upwards, penciling in an additional Rs 2.6 billion and Rs 5.1 billion in revenue for FY27 and FY28, along with incremental EBITDA of Rs 0.9 billion and Rs 1.8 billion in the same period. Net profit estimates have also been raised by 8% for FY27 and 12% for FY28 [1].

References:
[1] https://www.financialexpress.com/market/jm-financial-bets-on-67-upside-for-this-cdmo-stock-4-reasons-why-3970419/
[2] https://www.marketscreener.com/news/newamsterdam-pharma-insider-sold-shares-worth-453-452-according-to-a-recent-sec-filing-ce7d59d9df88f32c