The Cipla share price saw a massive 3.7% cut in trade today (October 24).The stock has been in focus after the pharma major signed a distribution and promotion agreement with Eli Lilly for tirzepatide (under a second brand named ‘Yurpeak’) in India. The pact is expected to lift Eli Lilly’s secondary sales but what’s in it for Cipla? Key brokerage house Nuvama raised the target price for Cipla to Rs 1,725 as they believe it will get a head start as a result of this deal. They have, however, retained the ‘Hold’ recommendation.
Nuvama on Cipla: FY26 revenue boost expected
Eli Lilly would supply the drug to Cipla, which would then be sold by Cipla at a price equivalent to Mounjaro. Outlining what the deal entails for Cipla, Nuvama pointed out that “Mounjaro’s secondary sales stood at Rs 391 crore so far in FY26, and we think Eli Lilly is on track to record Rs 900 crore in secondary sales in FY26.”
According to the brokerage house, this deal will enable Cipla to “get a headstart in India’s untapped GLP-1 market via the Yurpeak launch.”
Nuvana is estimating Rs 360 crore/Rs 370 crore revenue from Yurpeak in FY26/FY27 and Rs 410 crore from semaglutide generic in FY27. As a result they have raised FY26 PAT and revenue estimates by 1% each. For FY27, they estimate a Profit jump of 4% and revenue growth of 3%.
Nuvama on Cipla: Indian market lucrative
Nuvama pointed out that the “India market is lucrative and evolving rapidly.” According to them, “India’s obesity management market is evolving rapidly given the current pool of 90–100 million obese adults.”
According to NFHS-5, 24% of women and 23% of men in India are overweight or obese. The economic burden of this issue was $29 billion in 2019 and is estimated to balloon to $81 billion by 2030. Not only is that an alarming data pont, Nuvama also pointed out that India has 101 million people living with diabetes, and nearly half of these in the adult patients category are being inadequately treated with suboptimal glycemic control.
Novo Nordisk launched its oral semaglutide (Rybelsus) in 2022, and has been seeing healthy demand. Eli Lilly launched Mounjaro in March this year, and it clocked over Rs 100 crore in sales in September alone.
Nuvama estimated that India GLP-1 market is nearing the Rs 1,000 crore mark, “and we think this can expand to Rs 300–400 crore by FY28. We think urban India has 50 million patients, and current GLP-1s have only captured a market share of 0.2–0.3% in the target population.”
Cipla-Eli Lilly agreement- What it entails
As per the agreement with Cipla, Eli Lilly will manufacture/supply Yurpeak KwikPen (single-patient prefilled pen) to Cipla. Yurpeak would be priced on a par with Mounjaro, i.e. in the range of Rs 13,000– 26,000/month. Each pen contains four fixed doses, administered once weekly. The pen will be available in six dosage strengths. This deal expands availability of tirzepatide across India and beyond cities where Eli Lilly already has an established presence. Nuvama pointed out that with this deal, “Cipla gets early access to an effective and fast growing GLP-1 drug and gives Cipla a head start in the injectable GLP-1 race.”