GLENMARK - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 3.7

📊 Financial Overview: Glenmark Pharmaceuticals (GLENMARK) has a solid market cap of ₹53,350 Cr and maintains a low debt-to-equity ratio of 0.03, indicating prudent financial management. The company posted a strong PAT of ₹596 Cr this quarter, up from ₹269 Cr, reflecting a robust 31.4% profit variation. Return metrics are moderate, with ROCE at 9.72% and ROE at 7.35%, suggesting room for improvement in capital efficiency.

💹 Valuation Metrics: The stock trades at a P/E of 28.4, below the industry average of 33.1, indicating fair valuation. With a Book Value of ₹868, the P/B ratio is ~2.18. The PEG ratio of 14.2 suggests that the stock may be overvalued relative to its growth. Dividend yield is modest at 0.13%.

💊 Business Model & Competitive Advantage: Glenmark is a diversified pharmaceutical company with a strong presence in generics, specialty, and branded formulations across global markets. Its R&D capabilities and pipeline in dermatology, respiratory, and oncology provide long-term growth potential. However, competition and regulatory pressures remain key challenges.

📈 Technical Indicators: RSI at 44.8 indicates neutral momentum. MACD at -41.6 shows bearish divergence. The stock is trading below its 50 DMA (₹1,931) but above its 200 DMA (₹1,761), suggesting medium-term support. Volume is slightly below average, indicating subdued short-term interest.

🎯 Entry Zone: A favorable entry range would be around ₹1,800–₹1,850, offering a better margin of safety and aligning with technical support levels.

🕰️ Long-Term Holding Guidance: Glenmark is a stable pharma player with global exposure and a strong product pipeline. Long-term investors can consider accumulating on dips for steady growth and healthcare sector diversification.

✅ Positive

• Strong quarterly PAT growth of 31.4%.
• Low debt-to-equity ratio (0.03) ensures financial stability.
• EPS of ₹52.7 supports consistent earnings performance.
• DII holding increased by 0.97%, indicating domestic institutional confidence.

⚠️ Limitation

• Moderate ROCE (9.72%) and ROE (7.35%) suggest limited capital efficiency.
• High PEG ratio (14.2) indicates valuation may exceed growth expectations.
• Dividend yield of 0.13% offers minimal income support.

📉 Company Negative News

• MACD and RSI suggest short-term bearish sentiment.

📈 Company Positive News

• Stock has gained 60.9% from its 52-week low of ₹1,275.
• FII holding increased by 0.11%, reflecting foreign investor interest.

🏭 Industry

• Pharma sector benefits from global demand and regulatory-driven innovation.
• Industry P/E of 33.1 reflects moderate valuation across peers.

🧾 Conclusion

• Glenmark is a fundamentally sound pharma company with global reach and growth potential.
• Valuation is fair; consider accumulating near ₹1,800–₹1,850.
• Ideal for long-term investors seeking exposure to generics and specialty pharma segments.