Alkem’s Aim Adjusted: HSBC Trims Target Amid Pharma Headwinds

Alkem Laboratories (ALKE.NS) saw its price target trimmed by global brokerage HSBC, with analysts revising their 12-month target down to ₹5,000 from the previous ₹5,160. The adjustment comes amid a broader wave of cautious sentiment toward Indian equities, as sector headwinds and softer earnings growth projections weigh on market optimism.

 

HSBC’s Revised Outlook:

HSBC’s latest note reflects a more conservative stance on Indian pharma stocks, mirroring its recent downgrade of the overall Indian market to ‘neutral’. The brokerage sees limited upside due to high valuations and a slowdown in earnings momentum.

 

Stock Performance:

Alkem Laboratories’ share price hovered near ₹5,100 in early Friday trading, aligning closely with the new target. The stock has experienced volatility in recent months, with May returns historically negative for the company.

 

Analyst Consensus:

Despite the target cut, the consensus among analysts remains neutral, with a mix of buy, hold, and sell recommendations. The average 12-month target across brokerages stands slightly higher at ₹5,365, suggesting a modest upside from current levels.

 

Sector Context:

HSBC’s caution is not isolated to Alkem. The brokerage has also slashed targets for other sectors facing competitive and macroeconomic pressures, citing subdued profit growth and elevated valuations as key risks.

 

Investor Takeaway:

While Alkem remains fundamentally strong with a robust growth trend, investors are advised to monitor sector dynamics and valuation risks as the market recalibrates expectations for FY2025.

 

Sources: Economic Times, Moneycontrol, Investing.com