IPCALAB - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.8

📊 Core Financials Analysis

Profit Growth: Quarterly profit variation of 180% is eye-catching, but the drop from ₹248 Cr. to ₹180 Cr. suggests volatility.

Profitability

ROCE: 14.7% — modest, below ideal for capital-intensive pharma.

ROE: 12.8% — decent, but not exceptional.

Debt Position

Debt-to-Equity: 0.20 — low leverage, financially stable.

Cash Flow: Not disclosed, but low debt and consistent earnings imply reasonable operating cash flows.

📉 Valuation Metrics

Metric Value Interpretation

P/E Ratio 44.6 High vs. industry average (34.0), suggests premium valuation

P/B Ratio ~5.4 Reasonable for pharma, but not cheap

PEG Ratio -30.1 Negative PEG is a red flag — possibly due to declining or erratic earnings

EPS ₹29.1 Solid earnings base

Intrinsic Value Likely below CMP Indicates potential overvaluation

🧠 Business Model & Competitive Edge

Business Model: IPCA Labs is a well-established pharmaceutical company with a diversified product portfolio across generics, APIs, and branded formulations.

Competitive Advantage

Strong legacy and regulatory approvals (USFDA, etc.).

Global presence and export-driven revenue.

However, recent profit volatility and valuation pressure may limit near-term upside.

📌 Entry Zone & Investment Guidance

Current Price: ₹1,488

DMA 50: ₹1,432 — near-term support

DMA 200: ₹1,420 — long-term support

RSI: 58.6 — neutral to slightly bullish

MACD: Positive — bullish momentum

🔍 Suggested Entry Zone: ₹1,380–₹1,420 This range aligns with technical support and offers a better margin of safety.

📈 Long-Term Holding Guidance

Suitable for conservative investors seeking pharma exposure.

Hold for long-term if accumulated near support zones.

Watch for earnings consistency and margin improvement.

Avoid aggressive buying above ₹1,600 unless backed by strong growth catalysts.

Would you like a sector outlook or comparison with peers like Sun Pharma or Divi’s Labs?

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