Momentum of filings to improve over medium term Alembic Pharma (ALPM) is building a robust foundation for the next phase of growth in the US through huge capex (INR15b spent over FY16–20). This would be used to enhance its manufacturing strength in dosages other than oral solids (largely Injectables, Ophthalmic, and Derma); the company would be in the late stage of the capex cycle with INR7b in FY21. This move is supported by an industry-leading R&D spend (at 13–14% of sales) of INR22.9b over FY16–20. It has helped the company develop a strong product pipeline (200+ under development) for different dosages, which is expected to drive growth over the next three to four years. In fact, ALPM has already started filing ophthalmic and derma products from its new facilities. We raise our EPS estimates by 8%/7% over FY21/FY22 and the PE multiple to 20x (from 17x earlier) to factor better prospects from the ANDA pipeline, minimal regulatory risk, and a changed strategy in the Domestic Formulations (DF) market. We ascribe a 15% premium to its 10-year average to factor potential growth from new investments. Accordingly, we revise our price target to INR975 (from INR705 earlier). Earnings may appear stable over FY20–22, considering the COVID-19-led slowdown expected in DF for FY21. Moreover, meaningful contribution from the new capex program would reflect from 2HFY22. However, considering stock appreciation of ~60% over the past six months, we await a better entry point on the stock. Maintain Neutral.