Divi's Laboratories shares hit record high rising 84% YTD; buy, sell or hold after Q2 results 2026? Brokerages report

Divi's Laboratories shares rallied over 6% on Monday, 9 November, hitting a fresh 52-week high for the second consecutive session, after surging more than 8% during Sunday's special Muhurat Trading session. Strong second-quarter earnings for FY27 and upbeat brokerage commentary on the company's growth prospects, particularly in its custom synthesis and peptides businesses, have strengthened investor sentiment.

The pharmaceutical company's consolidated net profit jumped nearly 64% year-on-year (YoY) to ₹1,127 crore in the September quarter of FY27, compared with the corresponding period last year. Revenue from operations increased over 35% YoY to ₹3,676 crore during Q2 FY27.

Divi's Laboratories reported a foreign exchange gain of ₹24 crore during the quarter, compared with ₹63 crore in the year-ago period.

Following the strong quarterly performance, several brokerages have turned their attention to Divi's growth opportunities, particularly the expansion of its custom synthesis and peptide manufacturing capabilities. While Nuvama Institutional Equities, Goldman Sachs and JPMorgan remain positive on the stock, Motilal Oswal Financial Services has maintained a Neutral rating, citing limited upside at current valuations.

Nuvama Institutional Equities maintained its 'BUY' rating on Divi's Laboratories, citing the company's promising opportunity in peptide manufacturing. The brokerage said the installation of 3,000-litre solid-phase peptide synthesis (SPPS) lines to meet programme requirements, along with its focus on innovation-led peptides, positions the company for meaningful scale-up over the next two to three years.

It also highlighted that several peptide fragments are currently undergoing validation or qualification, strengthening its confidence in the company's growth prospects in this segment.

Nuvama has raised its valuation multiple for Divi's to 44 times EV/EBITDA from 40 times earlier and increased its target price to ₹12,000 from ₹9,600.

Motilal Oswal Financial Services has raised its earnings estimates for Divi's Laboratories by 21% for FY27 and 19% for FY28, factoring in the increasing contribution from projects progressing towards validation and commercialisation, an improved outlook for the generics and nutraceuticals businesses, and better operating leverage.

The brokerage expects the company to deliver revenue, EBITDA and profit after tax (PAT) compound annual growth rates (CAGR) of 23%, 34% and 33%, respectively, over FY26–FY28.

Motilal Oswal believes Divi's is well-positioned to secure business from large innovator customers, supported by its scientific capabilities across peptides, contrast media and generics, large-scale commercial manufacturing infrastructure and efficient supply chain management for raw materials and finished products.

However, the brokerage believes the stock's current valuation leaves limited room for further upside. It has therefore reiterated its 'NEUTRAL' rating, valuing the company at 65 times its 12-month forward earnings, arriving at a target price of ₹11,110.

Goldman Sachs has maintained its 'BUY' rating on Divi's Laboratories, with a price target of ₹11,700 per share, following the company's stronger-than-expected Q2 FY27 performance.

According to the brokerage, revenue and EBITDA grew 35% and 76% year-on-year, respectively, exceeding its estimates as well as broader market expectations.

The custom synthesis (CS) business was the key growth driver, recording a 54% YoY expansion against Goldman's estimate of 34%. The generics segment also performed better than expected, growing 12% against the brokerage's forecast of 4%, supported by healthy volume growth despite continued pricing pressure in certain product categories.

The company's EBITDA margin expanded by 989 basis points year-on-year to 42.6%, surpassing Goldman's estimate by 535 basis points. The improvement was driven by a favourable business mix, a higher contribution from custom synthesis, backward integration benefits at Unit 3 and operating leverage.

Following the quarterly results, Goldman Sachs raised its FY27–FY29 earnings per share (EPS) estimates by up to 17%.

According to media reports, JPMorgan has an 'OVERWEIGHT' rating on Divi's Laboratories and has raised its price target to ₹12,500 per share, following the company's strong Q2 FY27 performance.

The brokerage noted that revenue and EBITDA grew 35% and 76% year-on-year, respectively, beating consensus estimates by 15% and 33%. The custom synthesis business led the performance, posting 54% growth, supported by continued supplies from validation batches.

Looking ahead, JPMorgan expects the transition of projects from the validation stage to commercial production to emerge as a key growth driver. Of the company's three dedicated programmes, one is nearing commercialisation, while the remaining two are expected to advance over the next few quarters, subject to customer qualification and regulatory clearances.

The brokerage also highlighted Divi's plans to expand its peptide manufacturing capabilities by adding multi-tonne capacity through multiple 3,000-litre solid-phase peptide synthesis (SPPS) reactors. The company is targeting a position among the world's top three integrated peptide manufacturers.

To illustrate the scale of the opportunity, JPMorgan pointed to WuXi AppTec, the largest player in the peptides market, which has manufacturing capacity exceeding 100 kilolitres and has set a target of $2.5 billion in TIDES revenue for CY26.

Divi's Laboratories share price today opened at ₹11,105 apiece on the BSE; the stock touched an intraday high of ₹11,818 per share and an intraday low of ₹11,066.15 per share. The stock surged 84% so far in 2026.

Gaurav Arora, Head of Research at SAHI, said Divi’s Laboratories is witnessing a strong continuation breakout and is trading at an all-time high. The stock had earlier broken out of a broadening wedge pattern and has now extended its gains, indicating that buyers remain firmly in control.

Arora said ₹11,800 is the immediate resistance level to watch, while the trailing support is placed around ₹11,200. The technical structure remains strong as long as the stock holds above this support. He added that the stock's move to record highs signals strength, although some consolidation near the resistance level would be normal after the sharp rally.

Dhanya Nagasundaram works as a Content Producer at LiveMint, specializing in news related to financial markets, stocks, and business. With over eight years of experience in journalism and content creation, she has honed her skills in data-driven reporting and market analysis. Her focus is on monitoring stock trends, initial public offerings (IPOs), corporate news, policy shifts, and larger economic trends that affect investors and market players. <br><br> At LiveMint, Dhanya consistently writes and produces articles that make complex financial topics accessible to readers. She keeps a close eye on equity markets, commodities, and macroeconomic indicators, assisting audiences in comprehending how global and domestic events influence investment perspectives. Her stories frequently underscore emerging trends within sectors, the IPO market, company earnings results, and market strategies pertinent to both retail and institutional investors. <br><br> Before her tenure at LiveMint, Dhanya accumulated a wealth of professional experience at various companies, including MintGenie, Informist, Cogenics, Chary Publications, KPMG, and the Royal Bank of Scotland. These positions allowed her to establish a solid foundation in financial research, reporting, and content creation. <br><br> Throughout her career, she has explored numerous subjects such as trading strategies, commodities, IPOs, wealth generation, corporate profits, and macroeconomic indicators. Her background in both financial journalism and corporate settings has given her the ability to tackle stories with analytical rigor while ensuring clarity for her audience. Through her contributions, Dhanya strives to deliver insightful, trustworthy, and investor-centric financial content.

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HomeMarketsStock MarketsDivi's Laboratories shares hit record high rising 84% YTD; buy, sell or hold after Q2 results 2026? Brokerages report

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