⚠ 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.
GLAXO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.0
| Stock Code | GLAXO | Market Cap | 40,870 Cr. | Current Price | 2,408 ₹ | High / Low | 3,516 ₹ |
| Stock P/E | 43.2 | Book Value | 101 ₹ | Dividend Yield | 1.74 % | ROCE | 62.6 % |
| ROE | 46.4 % | Face Value | 10.0 ₹ | DMA 50 | 2,463 ₹ | DMA 200 | 2,638 ₹ |
| Chg in FII Hold | -0.16 % | Chg in DII Hold | -0.05 % | PAT Qtr | 253 Cr. | PAT Prev Qtr | 205 Cr. |
| RSI | 50.0 | MACD | -27.5 | Volume | 21,634 | Avg Vol 1Wk | 68,102 |
| Low price | 1,921 ₹ | High price | 3,516 ₹ | PEG Ratio | -2.18 | Debt to equity | 0.02 |
| 52w Index | 30.6 % | Qtr Profit Var | 3.15 % | EPS | 56.0 ₹ | Industry PE | 29.0 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT increased from 205 Cr. to 253 Cr., showing modest growth with 3.15% YoY variation.
- Margins: ROE at 46.4% and ROCE at 62.6% reflect exceptional profitability and capital efficiency.
- Debt Ratios: Debt-to-equity at 0.02 indicates a virtually debt-free balance sheet.
- Cash Flows: Stable operating cash flows supported by strong pharmaceutical demand.
- Return Metrics: EPS at 56 ₹ demonstrates consistent earnings generation.
💹 Valuation Indicators
- P/E Ratio: 43.2, significantly above industry PE of 29.0, suggesting premium valuation.
- P/B Ratio: ~23.8 (Current Price / Book Value), indicating expensive valuation relative to book value.
- PEG Ratio: -2.18, reflecting weak growth expectations despite high valuation.
- Intrinsic Value: Current price (2,408 ₹) appears overvalued compared to fundamentals; upside potential limited unless growth accelerates.
🏢 Business Model & Competitive Advantage
- Operates in pharmaceuticals and healthcare with strong brand presence.
- Competitive advantage lies in global parent support, established distribution, and trusted brand equity.
- Resilient business model with steady demand for healthcare products.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 2,200 ₹ – 2,350 ₹ (near DMA 200).
- Long-Term Holding: Suitable for long-term investors seeking exposure to healthcare, though valuations are stretched.
Positive
- Debt-free balance sheet.
- Exceptional ROE and ROCE.
- Strong brand presence in healthcare.
- Stable dividend yield of 1.74%.
Limitation
- High P/E and P/B ratios indicate expensive valuation.
- PEG ratio signals weak growth outlook.
- Quarterly profit growth is modest compared to peers.
Company Negative News
- Reduction in FII (-0.16%) and DII (-0.05%) holdings, showing cautious institutional sentiment.
Company Positive News
- Quarterly PAT growth despite challenging market conditions.
- Strong profitability metrics with high ROE and ROCE.
Industry
- Pharmaceutical sector remains resilient with steady demand.
- Industry PE at 29.0 reflects moderate investor optimism.
Conclusion
- Glaxo is a fundamentally strong healthcare company with exceptional profitability and brand strength.
- Valuation is premium, limiting near-term upside.
- Best suited for long-term investors seeking defensive exposure to healthcare, but entry should be considered at lower levels.
Would you like me to also contrast Glaxo’s valuation with peers like Pfizer India or Sanofi India to highlight relative positioning in the pharma sector?