Laurus Labs zooms 73% in 2025, hits new high; what's driving pharma stock?

Laurus Labs management said the fundamentals of the company's business remain strong, with sustained growth momentum in the Contract Development and Manufacturing Organization and Generic business.

Laurus Labs share price today

 

Share price of Laurus Labs hit a new high of ₹1,043, gaining 3 per cent on the BSE in Friday’s intra-day trade on expectations of strong earnings.  The stock price of the pharmaceutical company surpassed its previous high of ₹1,040 touched on December 1, 2025.

 

Thus far in the calendar year 2025, Laurus Labs has outperformed the market by zooming 73 per cent. The stock was the top gainer among BSE midcap non-finance companies. In comparison, the BSE Sensex was up 8 per cent during the period.  READ STOCK MARKET UPDATES TODAY LIVE

 

What’s driving Laurus Labs stock price?

 

Laurus Labs reported a strong earnings for the September 2025 quarter (Q2FY26) as the company achieved revenue of ₹1,653 crore, representing 35 per cent growth and EBITDA of ₹429 crore, representing 136 per cent growth. The earnings before interest, taxes, depreciation, and amortization (EBITDA) margins continue to remain very healthy at 26.0 per cent, supported by continuing operating leverage. Profit after tax (PAT) stood ₹193.8 crore, driven by a favourable product mix and strong operational performance.

 

The company reported a second consecutive quarter of a strong 30 per cent plus growth, with the gross margin improving by 50bp QoQ (led by a better product mix & higher commercial molecule deliveries).

 

The management had said the fundamentals of the company’s business remain strong, with sustained growth momentum in the Contract Development and Manufacturing Organization (CDMO) and Generic business. 

CDMO division continues to see strong demand momentum, recording Q2 sales of ₹471 crore. And for the H1FY26, the division recorded a sale of ₹964 crore with a healthy growth of about 88 per cent over the same period last fiscal.

 

The management said this growth was mainly driven by several mid to late-phase program deliveries and as well as commercial deliveries, and also, increased sales from its new manufacturing assets that have come online. The pipeline momentum and RFP flow have remained strong with a well-balanced mix of big pharma clients, small to mid-sized biotechs.

 

Laurus holds a leadership position in developing and manufacturing select Active Pharmaceutical Ingredients (APIs) and Finished Dosage Forms (FDF) across anti-retroviral, oncology, cardiovascular, and gastro therapeutics.  ALSO READ | Ola Electric hits 10% upper circuit after promoter completes stake sale

ICICI Securities sees more upside in Laurus stock

The CDMO growth was driven by several mid-to-late stage new chemical entity (NCE) deliveries and steady increase in sales from new manufacturing assets. Out of ₹3,400 crore of capex that the company has incurred during FY22-26, almost ~77 per cent was earmarked towards API / CDMO. The company is now getting the benefit of the same as the CDMO quarterly run rate has gone up from ₹220-250 crore to ₹ 450-500 crore in two years. The CDMO contribution has also gone up from ~16 per cent to 28 per cent which has led to significant margin expansion.

 

The management has reiterated the annual capex guidance of ₹1,000 crore. Analysts at ICICI Securities said they continue to monitor progress on these driving factors which in a way are expected to change the business mix in favour of these segments in lieu of ARV. The brokerage firm has a ‘BUY’ rating on Laurus Labs with a target price of ₹1,075.  =========================  Disclaimer: View and outlook shared on the stock belong to the respective brokerages and are not endorsed by Business Standard. Readers discretion is advised.