ASTRAZEN - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.7
| Stock Code | ASTRAZEN | Market Cap | 20,532 Cr. | Current Price | 8,213 ₹ | High / Low | 10,691 ₹ |
| Stock P/E | 98.7 | Book Value | 320 ₹ | Dividend Yield | 0.39 % | ROCE | 33.4 % |
| ROE | 23.6 % | Face Value | 2.00 ₹ | DMA 50 | 8,440 ₹ | DMA 200 | 8,570 ₹ |
| Chg in FII Hold | 0.07 % | Chg in DII Hold | 0.24 % | PAT Qtr | 31.6 Cr. | PAT Prev Qtr | 58.1 Cr. |
| RSI | 43.6 | MACD | 12.1 | Volume | 11,763 | Avg Vol 1Wk | 6,780 |
| Low price | 7,552 ₹ | High price | 10,691 ₹ | PEG Ratio | 2.28 | Debt to equity | 0.04 |
| 52w Index | 21.1 % | Qtr Profit Var | -42.3 % | EPS | 80.4 ₹ | Industry PE | 30.1 |
📊 Financials: ASTRAZEN demonstrates strong efficiency with ROCE at 33.4% and ROE at 23.6%, supported by a very low debt-to-equity ratio of 0.04. However, quarterly PAT fell sharply (-42.3%), indicating profit instability. EPS remains solid at ₹80.4, but declining profitability raises concerns about cash flow sustainability.
💹 Valuation: The stock trades at a high P/E of 98.7 compared to the industry average of 30.1, suggesting significant overvaluation. The PEG ratio of 2.28 indicates growth is not keeping pace with valuation. With a book value of ₹320, the P/B ratio is ~25.7, further highlighting stretched valuations.
🏢 Business Model & Competitive Advantage: Operating in the pharma sector, ASTRAZEN benefits from defensive demand and efficient capital use. Its competitive advantage lies in strong return metrics and low leverage. However, profit contraction weakens the sustainability of this edge.
🎯 Entry Zone: A more attractive entry zone lies near ₹7,550–₹7,700 (support levels). Current price of ₹8,213 remains above intrinsic comfort, suggesting cautious positioning.
📈 Long-Term Holding Guidance: Suitable for long-term investors only if earnings stabilize and valuations normalize. Otherwise, partial allocation with strict monitoring is recommended.
Positive
- Strong ROCE (33.4%) and ROE (23.6%)
- Low debt-to-equity ratio (0.04)
- Healthy EPS at ₹80.4
- Defensive pharma sector positioning
Limitation
- High P/E (98.7) vs industry average (30.1)
- P/B ratio ~25.7 indicates overvaluation
- Quarterly profit decline (-42.3%)
- Neutral RSI (43.6) and weak momentum
Company Negative News
- Quarterly PAT dropped from ₹58.1 Cr. to ₹31.6 Cr.
- Low trading volume reduces reliability of momentum signals
Company Positive News
- Incremental increase in DII holdings (+0.24%)
- Stable FII holdings (+0.07%)
Industry
- Pharma sector P/E at 30.1, much lower than ASTRAZEN’s valuation
- Sector rotation favors defensives, but valuations remain stretched
Conclusion
⚖️ ASTRAZEN is fundamentally efficient with strong return metrics and low leverage, but faces valuation excess and profit contraction. Entry is advisable only near support levels (~₹7,550–₹7,700). Long-term holding requires earnings recovery and valuation normalization; otherwise, cautious partial exposure is recommended.