Analysts largely neutral on Gland Pharma’s acquisition of Cenexi Group

Hyderabad-based Gland Pharma on November 29 said it had agreed to acquire 100 percent equity in French drug maker Cenexi Group for a value not exceeding 120 million euros.

The agreement was reached by Gland Pharma’s Singapore-based subsidiary, Gland Pharma International.

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Gland Pharma’s management expects to close the transaction by February/March 2023 and to fund the deal through internal accruals.

The stock, after gaining more than 10 percent over the last two trading sessions, lost more than 4 percent in trading on Wednesday.

Here are what securities firms are saying about the deal.


Maintains a neutral rating and target price of Rs 2,236 on the shares of Gland, which is 25 times September 2024 Forward earnings per share of Rs. 89.5/share.

The Nomura note came quick on the heels of the company’s announcement of the put option agreement to acquire 100 percent Cenexi Group.

A put option is a contract giving the option buyer the right, but not the obligation, to sell a specified amount of an underlying security at a predetermined price within a specified time frame.

Based on Gland Pharma’s observations, the strategic rationale behind the acquisition appears unclear, Nomura said.

Says Cenexi’s technology platforms that complement Gland’s current capabilities are in a very early stage. Views the acquisition as neutral, with no case of material value accretion/destruction.

Morgan Stanley

Maintains an overweight rating and a price target of Rs 2,558 per share.

The deal appears complementary to Gland in terms of market access to the European Union, branded pharma customer base and some technologies.

The securities firm expects it to be marginally earnings accretive in Year 1 (FY 2024). There is scope for meaningful value unlocking, subject to synergy execution.

BofA Research

Bank of America Research maintains a ‘buy’ rating on its structural growth story and sees visible levels for growth and margin recovery. Sets a target price of Rs 2,800 per share and sees limited EPS impact. Execution is key, it said.

The securities firm expects the acquisition to strengthen Gland Pharma’s position in the EU injectables market. Sees execution based on revenue momentum and margin expansion as key factors.

Expects news on the possible sale of Chinese company Fosun’s stake in Gland to create a floor for the stock in the near term with the outcome of this unlikely in the next few months, added Bank of America Research.Disclaimer: The views and investment tips expressed by investment experts on are their own and not those of the website or its management. advises users to check with certified experts before taking any investment decisions.​​​