Macquarie says accelerating U.S. generic sales are providing comfort about margins.
"Given its execution track record, strong balance sheet, earnings momentum and defensive characteristics, LPC (Lupin) should sustain premium valuation of around 20 times FY15 earnings," Macquarie wrote.
Lupin shares were down 1.62 per cent at Rs 974 at 3 pm.
Drug major Lupin on Wednesday posted 35.5 per cent rise in consolidated net profit at Rs 553 crore for the fourth quarter ended March 31, 2013-14, on the back of robust sales in various markets including the US, Europe and South Africa.
The company had posted net profit of Rs 408.08 crore in the January-March quarter of the 2012-13 fiscal.
Net sales of the company rose to Rs 3,051.55 crore in Q4, 2013-14, from Rs 2,537.35 crore in the year-ago period. For the entire 2013-14, it posted consolidated net profit of Rs 1,836.37 crore, up 39.7 per cent, as compared to Rs 1,314.16 crore in the 2012-13 fiscal.
Lupin's consolidated net sales last fiscal rose to Rs 11,086.64 crore, from Rs 9,461.63 crore in 2012-13.