⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
AJANTPHARM - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.1
| Stock Code | AJANTPHARM | Market Cap | 38,041 Cr. | Current Price | 3,045 ₹ | High / Low | 3,228 ₹ |
| Stock P/E | 40.3 | Book Value | 330 ₹ | Dividend Yield | 0.92 % | ROCE | 33.0 % |
| ROE | 25.7 % | Face Value | 2.00 ₹ | DMA 50 | 2,891 ₹ | DMA 200 | 2,718 ₹ |
| Chg in FII Hold | -0.56 % | Chg in DII Hold | 0.68 % | PAT Qtr | 245 Cr. | PAT Prev Qtr | 250 Cr. |
| RSI | 58.2 | MACD | 44.6 | Volume | 1,31,125 | Avg Vol 1Wk | 2,06,015 |
| Low price | 2,022 ₹ | High price | 3,228 ₹ | PEG Ratio | 5.08 | Debt to equity | 0.01 |
| 52w Index | 84.8 % | Qtr Profit Var | -2.94 % | EPS | 75.5 ₹ | Industry PE | 27.6 |
📊 Financials
- Revenue & Profitability: PAT declined slightly from ₹250 Cr. to ₹245 Cr., showing a -2.94% quarterly variation. EPS at ₹75.5 is strong, reflecting solid earnings capacity.
- Margins & Returns: ROCE at 33.0% and ROE at 25.7% are excellent, highlighting superior efficiency and profitability.
- Debt & Liquidity: Debt-to-equity ratio of 0.01 indicates a virtually debt-free balance sheet, ensuring financial resilience.
- Cash Flow: Dividend yield of 0.92% provides modest shareholder returns alongside reinvestment capacity.
💹 Valuation
- P/E Ratio: 40.3 vs Industry PE of 27.6 — trading at a premium valuation.
- P/B Ratio: Current price ₹3,045 vs Book Value ₹330 — ~9.2x book value, expensive relative to assets.
- PEG Ratio: 5.08 — suggests stretched valuation compared to growth prospects.
- Intrinsic Value: Current price is above fair value, offering limited margin of safety.
🏢 Business Model & Competitive Advantage
- Strong presence in pharmaceuticals with diversified product portfolio.
- High ROCE and ROE reflect operational excellence and competitive strength.
- Debt-free structure enhances resilience and flexibility in expansion.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between ₹2,850 – ₹3,000, closer to DMA 50 support.
- Long-Term Holding: Strong fundamentals and industry tailwinds make it a good candidate for long-term holding, though valuations are stretched. Accumulate on dips.
✅ Positive
- Excellent ROCE (33%) and ROE (25.7%) highlight superior efficiency.
- Debt-to-equity ratio of 0.01 ensures financial stability.
- DII holdings increased by 0.68%, showing domestic institutional confidence.
⚠️ Limitation
- Valuation multiples (P/E, P/B, PEG) suggest overvaluation.
- Quarterly PAT declined slightly (-2.94%).
- Premium valuation compared to industry average PE.
📉 Company Negative News
- FII holdings declined by 0.56%, showing reduced foreign investor confidence.
- Quarterly profit decline indicates short-term weakness.
📈 Company Positive News
- Strong EPS of ₹75.5 reflects robust earnings capacity.
- Stock trading above DMA 50 and DMA 200 indicates bullish technical momentum.
🏭 Industry
- Pharmaceutical sector benefits from global demand and healthcare expansion.
- Industry PE at 27.6 is lower than company’s valuation, highlighting premium pricing for AJANTPHARM.
🔎 Conclusion
AJANTPHARM demonstrates strong fundamentals with excellent efficiency, debt-free stability, and robust earnings. However, valuations are stretched, and short-term profit decline raises caution. Best strategy: accumulate near ₹2,850–₹3,000 and hold for long-term gains, leveraging industry growth and the company’s competitive strength.