Ami Organics extends rally on strong Q3 results; stock zooms 30% in 4 days

The management believes, that on account of ramp-up of existing products, Fermion contract, and potential commercialisation of another CDMO contract in FY26E, Ami has strong revenue visibility.

Shares of Ami Organics hit a new high of Rs 2,441.90, gaining 2 per cent on the BSE in Saturday’s intra-day trade, extending its past 3-day upward movement after the company reported robust earnings for the quarter ended December 2024 (Q3FY25).

 

In the last four trading days, the stock of this pharmaceutical firm has zoomed 30 per cent following an improved visibility for the January-March quarter (Q4FY25); the management revised FY25 growth guidance upward from 30 per cent to 35 per cent. 

 

In Q3FY25, the company’s profit after tax (PAT) more than doubled to Rs 45.4 crore, on the back of healthy operational performance. The smallcap had posted a profit of Rs 17.8 crore in a year ago quarter (Q3FY24).

 

The company, a leading global manufacturer of advance pharmaceutical intermediates and speciality chemicals, delivered an impressive 65.2 per cent year-on-year (YoY) growth, achieving Rs 275 crore in revenue from operations. In the first nine months of FY25, the company achieved revenue of Rs 698 crore, nearly equalling the revenue from operations of the entire previous financial year. This performance was driven by a strong ramp-up in contract development and manufacturing organization (CDMO) business and consistent growth in advanced pharmaceutical intermediates, the company said.

 

The company’s earnings before interest, tax, depreciation and amortisation (EBITDA) was up 159 per cent YoY at Rs 68.7 crore; margins expanded to 25.0 per cent from 15.9 per cent in Q3FY24.  ALSO READ: Triveni Turbine share price advances 5% on Q3FY25 results; details here

 

The management said the company’s pipeline of CDMO projects is progressing well, with several initiatives nearing commercialization by FY26, solidifying the foundation for sustained long-term growth. Ongoing discussions with innovators and partners remain highly encouraging, and the management is confident that the CDMO segment will see exponential growth in the coming years.

 

Ami Organics is a research and development (R&D) driven manufacturer of speciality chemicals focused towards the development and manufacturing of advanced pharmaceutical intermediates for regulated and generic active pharmaceutical ingredients (APIs) and chemicals for New Chemical Entities (NCE), and other specialty chemicals including parabens and paraben formulations, methyl salicylate , semiconductor chemicals, electrolyte additives and niche key starting materials (KSM) for cosmetics, fine chemicals and agrochemical industries.

 

In the past six months, the stock has outperformed the market by surging 80 per cent, as compared to 5 per cent decline in the BSE Sensex. In the last one year, it zoomed 112 per cent, as against 8.5 per cent rise in the benchmark index. 

 

Looking at the strong off-take of Nubeqa intermediates along with other CDMO projects (one of which is expected to contribute to top line from FY26); the company has indicated Rs 1,000 crore of CDMO sales by FY28E. Analysts at JM Financial Institutional Securities, however, have conservatively built in Rs 920 crore of CDMO sales by FY28E. Another major positive was the sharp jump in EBITDA margin to 25 per cent (which we were earlier building in by FY27E) on account of higher contribution of CDMO sales, the brokerage firm said in result update. 

 

On account of ramp-up of existing products (Apixaban, Trazadone, etc.), continued strong ramp-up of Fermion contract, and potential commercialisation of another CDMO contract in FY26E, Ami has strong revenue visibility. Factoring in sharp jump in EBITDA margin, our FY25/26/27 EBITDA and EPS estimates are revised upwards by ~14 per cent/5 per cent/2 per cent and 17 per cent/7 per cent/3 per cent, respectively, the brokerage firm said with maintains BUY ratings and a revised March 2026 target price of Rs 2,605 share (based on 35x Mar’27E EPS) (from Rs 2,500 earlier).