Shares of pharmaceutical major Alembic Pharma surged as much as 15.9% to hit an intraday high of ₹834 apiece on the BSE today, after DSP Healthcare Fund raised its stake in the company marginally by 0.02%.

According to the exchange filing, DSP Healthcare fund, which was launched by DSP Mutual Fund, acquired 36,276 shares in Alembic Pharma to hike its stake in the company to 5.01%. The company earlier held a 4.99% stake in Alembic Pharma.

The scrip opened marginally higher at ₹719.55 as against the previous closing price of ₹719.40. At 1:58 pm, the share price of the company was trading 4.25% higher at ₹750. In contrast to this, the broader BSE Sensex was trading 33.80 points or 0.05% lower at 66,868.11. The company’s market capitalisation stood at ₹14,796.29 crore with more than 1.50 lakh shares exchanging hands on the BSE as against the two-week average of 5,674 shares.

At present, the share price of the company is trading 10.5% lower than the 52-week high of ₹839, which the company touched on October 19 this year. The share price of the company is trading 62.3% higher as against the 52-week low of ₹463.30, which the company touched on March 29 this year.

In the past six months, the counter has given 35.18% in return. In the year-to-date period, the counter has given 31.92% in return.

In the July to September quarter of FY24, the consolidated profit after tax of Alembic Pharma surged 3.21% year-on-year (YoY) to ₹136.56 crore. The company’s revenue from operations during the quarter under review surged 8.17% to ₹1,594.93 crore as against ₹1,475.01 crore in the same period last year. The company’s EBITDA (earnings before interest, tax, depreciation and amortisation), however, declined by 10.5% year-on-year to ₹208.3 crore. The company’s PAT margins contracted by 48 basis points year-on-year (YoY) during the quarter under review.

According to analysts at KR Choksey, the company’s revenues/ EBITDA/ PAT are to grow by 11.5%/ 29.1%/ 43.1% CAGR, respectively, over FY23-25E.

"The company's shares are currently trading at 27.3x/ 20.7x its FY24E/FY25E revised EPS (earnings per share) of ₹27.0/35.6 respectively. Applying a target P/E multiple of 21.7x on FY25E EPS of INR 35.6, we arrive at a target price of INR 770/share, which gives a potential upside of 3.6% from the CMP. Accordingly, we maintain our rating of 'HOLD' on the shares of Alembic Pharma," the brokerage firm says in a note.

(DISCLAIMER: The views and opinions expressed by investment experts on are either their own or of their organisations, but not necessarily that of and its editorial team. Readers are advised to consult certified experts before taking investment decisions.)

Follow us on Facebook, Twitter, YouTube & Instagram to never miss an update from Fortune India. To buy a copy, visit Amazon.