⚠ 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.
SYNGENE - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.5
| Stock Code | SYNGENE | Market Cap | 16,881 Cr. | Current Price | 419 ₹ | High / Low | 761 ₹ |
| Stock P/E | 44.0 | Book Value | 115 ₹ | Dividend Yield | 0.30 % | ROCE | 12.8 % |
| ROE | 9.78 % | Face Value | 10.0 ₹ | DMA 50 | 475 ₹ | DMA 200 | 593 ₹ |
| Chg in FII Hold | -1.35 % | Chg in DII Hold | 1.21 % | PAT Qtr | 68.7 Cr. | PAT Prev Qtr | 66.2 Cr. |
| RSI | 41.4 | MACD | -18.8 | Volume | 9,08,300 | Avg Vol 1Wk | 28,94,356 |
| Low price | 381 ₹ | High price | 761 ₹ | PEG Ratio | 34.1 | Debt to equity | 0.07 |
| 52w Index | 9.87 % | Qtr Profit Var | -44.2 % | EPS | 8.22 ₹ | Industry PE | 52.3 |
📊 Financial Overview
- Revenue & Profit Growth: Quarterly PAT improved slightly from ₹66.2 Cr. to ₹68.7 Cr., but YoY profit variation (-44.2%) shows weakness.
- Margins: ROE at 9.78% and ROCE at 12.8% reflect moderate profitability and efficiency.
- Debt: Debt-to-equity ratio of 0.07 indicates very low leverage, ensuring financial stability.
- Cash Flow: Stable due to contract research services, though growth momentum has slowed.
💹 Valuation Indicators
- P/E Ratio: 44.0 vs Industry PE of 52.3 → slightly undervalued compared to peers.
- P/B Ratio: Current Price ₹419 vs Book Value ₹115 → ~3.64x, reflecting premium valuation.
- PEG Ratio: 34.1 → indicates overvaluation relative to growth prospects.
- Intrinsic Value: Estimated fair value near ₹380–400, suggesting current price is slightly overvalued.
🔬 Business Model & Competitive Advantage
- Operates in contract research and development services for pharma and biotech companies.
- Competitive advantage lies in specialized R&D capabilities and long-term client relationships.
- Exposure to global pharma demand provides growth opportunities, but margins remain modest.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive between ₹380–400, closer to intrinsic value.
- Long-Term Holding: Suitable for investors seeking exposure to pharma R&D outsourcing; hold for 3–5 years with caution due to valuation risks.
✅ Positive
- Low debt-to-equity ratio (0.07) ensures financial stability.
- DII holdings increased (+1.21%), showing domestic institutional confidence.
- Strong positioning in pharma R&D outsourcing market.
⚠️ Limitation
- ROE (9.78%) and ROCE (12.8%) reflect only moderate efficiency.
- PEG ratio (34.1) signals overvaluation relative to growth.
- Profit variation (-44.2%) highlights earnings weakness.
📉 Company Negative News
- FII holdings decreased (-1.35%), showing reduced foreign investor confidence.
- Quarterly profit growth remains weak compared to industry peers.
📈 Company Positive News
- DII holdings increased, reflecting domestic confidence.
- Strong client base in global pharma and biotech sectors.
- Low debt levels provide resilience against market volatility.
🏭 Industry
- Pharma R&D outsourcing industry is growing, driven by global demand for cost-efficient research.
- Industry PE at 52.3 shows sector is valued higher than Syngene’s current P/E, indicating relative undervaluation.
- Global pharma innovation and outsourcing trends support long-term growth.
🔎 Conclusion
Syngene demonstrates moderate fundamentals with stable operations, low debt, and strong industry positioning. However, weak ROE/ROCE and high PEG ratio limit near-term attractiveness. Entry around ₹380–400 offers better risk-reward. Long-term investors can hold for 3–5 years, benefiting from global pharma outsourcing demand, but caution is advised due to valuation risks and earnings volatility.