LUPIN - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.7

📊 Financial Overview

• Revenue Growth: Strong quarterly profit growth of 139% indicates robust top-line momentum
• Profit Margins: High ROCE (21.9%) and ROE (17.8%) reflect efficient capital utilization
• Debt Ratios: Extremely low debt-to-equity ratio of 0.01 — virtually debt-free
• Cash Flows: Healthy PAT of ₹2,128 Cr. this quarter, up from ₹1,291 Cr.
• Return Metrics: EPS of ₹114 supports strong shareholder value creation

📈 Valuation Metrics

• P/E Ratio: 17.1 — significantly below industry average of 33.1
• P/B Ratio: ~3.7 (based on Book Value ₹532)
• PEG Ratio: 0.10 — indicates undervaluation relative to growth
• Intrinsic Value: Estimated above ₹2,200 based on earnings and growth potential

🏢 Business Model & Competitive Edge

• Global Reach: Operates in over 100 countries with strong U.S. generic market presence
• Segment Strength: Focus on generics, APIs, and specialty drugs
• Innovation: Investment in biosimilars and complex generics enhances long-term moat

📌 Entry Zone Recommendation

• Suggested Entry: ₹1,850–₹1,950 — near DMA50 and DMA200 support levels
• Technical Indicators: RSI at 53.4 (neutral), MACD negative (short-term caution)

📈 Long-Term Holding Guidance

• Strong fundamentals and global footprint make Lupin a compelling long-term hold
• Low debt and improving profitability offer resilience and growth potential

✅ Positive

• Exceptional quarterly profit growth
• Low debt and strong return ratios
• Undervalued compared to industry peers
• Expanding specialty drug portfolio

⚠️ Limitation

• Decline in FII holding by 0.75%
• MACD suggests short-term bearish momentum

📰 Company Negative News

• No major negative developments reported recently

🌟 Company Positive News

• Q4 PAT doubled YoY; dividend payout increased
• Expansion in U.S. generics and specialty segments

🏭 Industry

• Pharma industry P/E at 33.1 — Lupin trades at a discount
• Sector driven by innovation, regulatory approvals, and global demand

🧾 Conclusion

• Lupin is fundamentally strong, undervalued, and well-positioned for long-term growth
• Ideal for accumulation near support zones; maintain a long-term investment horizon

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