GLAXO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | GLAXO | Market Cap | 39,580 Cr. | Current Price | 2,336 ₹ | High / Low | 3,516 ₹ |
| Stock P/E | 39.8 | Book Value | 101 ₹ | Dividend Yield | 1.80 % | ROCE | 62.6 % |
| ROE | 46.4 % | Face Value | 10.0 ₹ | DMA 50 | 2,429 ₹ | DMA 200 | 2,554 ₹ |
| Chg in FII Hold | -0.01 % | Chg in DII Hold | -0.02 % | PAT Qtr | 277 Cr. | PAT Prev Qtr | 253 Cr. |
| RSI | 39.9 | MACD | -3.67 | Volume | 1,17,290 | Avg Vol 1Wk | 1,20,292 |
| Low price | 2,218 ₹ | High price | 3,516 ₹ | PEG Ratio | -2.01 | Debt to equity | 0.02 |
| 52w Index | 9.15 % | Qtr Profit Var | 21.3 % | EPS | 58.8 ₹ | Industry PE | 30.1 |
📊 Financials: GLAXO demonstrates strong profitability with ROE at 46.4% and ROCE at 62.6%, supported by a low debt-to-equity ratio of 0.02. EPS at ₹58.8 reflects consistent earnings. Quarterly PAT rose to ₹277 Cr. from ₹253 Cr., showing healthy growth. However, weak 52-week performance (9.15%) limits investor confidence.
💹 Valuation: Current P/E of 39.8 is above the industry average of 30.1, indicating premium valuation. PEG ratio of -2.01 highlights weak growth prospects relative to valuation. Book value of ₹101 vs. CMP ₹2,336 shows a steep P/B multiple, justified only by profitability strength.
🏗️ Business Model: GLAXO operates in pharmaceuticals with strong brand equity, diversified product portfolio, and global presence. Its competitive advantage lies in established distribution, regulatory approvals, and consistent demand for healthcare products.
📈 Entry Zone: Accumulation near ₹2,300–₹2,320 (close to support and below DMA50) offers favorable risk-reward. RSI at 39.9 indicates oversold conditions, while MACD at -3.67 suggests weak momentum. Exit strategy near ₹2,500–₹2,550 with stop-loss around ₹2,200.
🕰️ Long-Term Holding: Strong efficiency metrics and dividend yield (1.80%) support long-term holding. However, premium valuation and negative PEG ratio warrant cautious accumulation. Suitable for defensive investors seeking stable pharma exposure.
Positive
- High ROCE (62.6%) and ROE (46.4%) efficiency
- Low debt-to-equity ratio (0.02)
- Quarterly PAT growth (+21.3%)
- Dividend yield of 1.80% provides steady returns
Limitation
- High P/E (39.8) vs. industry average (30.1)
- Negative PEG ratio (-2.01) signals weak growth outlook
- Weak 52-week performance (9.15%)
- Slight decline in FII (-0.01%) and DII (-0.02%) holdings
Company Negative News
- No major negative news reported; valuation concerns persist
Company Positive News
- Quarterly profit growth (+21.3%)
- Strong efficiency metrics support long-term stability
Industry
- Pharma industry P/E at 30.1 reflects premium valuations
- Sector benefits from defensive demand and regulatory approvals
Conclusion
GLAXO is fundamentally strong with high efficiency and stable dividends, but premium valuation and weak growth prospects limit upside. Entry near ₹2,300–₹2,320 is favorable, with profit booking advised near ₹2,500–₹2,550. Best suited for defensive investors seeking stability rather than aggressive growth.