TORNTPHARM - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.4

📊 Core Financials Breakdown

Profitability

ROCE: 27.8% and ROE: 26.2% — outstanding, signaling strong capital efficiency and operational excellence.

EPS: ₹58.2, with PAT rising from ₹492 Cr. to ₹551 Cr. — a healthy 17.5% quarterly growth.

Debt-to-equity: 0.35 — moderate leverage, well within safe bounds for a pharma company.

Dividend Yield: 0.90% — modest but consistent, suitable for long-term holders.

Institutional Sentiment

Slight dip in FII holdings (-0.22%) and a mild increase in DII (+0.29%) — neutral to slightly positive.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 60.8 Significantly above industry average (33.4) — premium valuation.

P/B Ratio ~15.9 High, but justified by strong brand and earnings power.

PEG Ratio 2.50 Elevated — suggests valuation is stretched relative to growth.

Intrinsic Value ~₹3,200–₹3,400 (est.) Current price of ₹3,567 is slightly above fair value.

🧠 Business Model & Competitive Edge

Core Operations: Branded generics, specialty drugs, and formulations across India, US, and emerging markets.

Strengths

Strong domestic franchise and leadership in chronic therapies.

High-margin portfolio and consistent cash flows.

Proven track record of regulatory compliance and R&D productivity.

Challenges

Elevated valuation and moderate debt.

RSI at 48.0 — neutral, MACD at -6.98 — bearish crossover.

📈 Entry Zone & Technicals

DMA 50: ₹3,543, DMA 200: ₹3,334 — price is hovering near short-term average, slightly above long-term.

RSI: 48.0 — neutral zone.

MACD: -6.98 — bearish momentum.

📌 Entry Zone: ₹3,300–₹3,450 — ideal for accumulation on dips.

🕰️ Long-Term Holding Guidance

Outlook: Strong fundamentals and high return metrics make Torrent Pharma a solid long-term compounder.

2025 Target: ₹3,800–₹4,200

2030 Target: ₹5,000–₹6,200

Holding Strategy: Ideal for long-term investors seeking exposure to high-quality pharma with consistent earnings and strong domestic dominance. Accumulate during technical weakness and hold through cycles.

You can explore more on Trendlyne’s stock dashboard or check the latest financial breakdown for deeper insights.

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