TORNTPHARM - Fundamental Analysis

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

Fundamental Rating: 4.1

Here’s a comprehensive analysis of Torrent Pharmaceuticals Ltd (TORNTPHARM), a leading player in India’s pharma sector

📊 Core Financials

Profitability & Growth

PAT: ₹548 Cr (up from ₹515 Cr) — 19.9% quarterly growth

EPS: ₹59.2 — strong earnings base

ROE: 26.5%, ROCE: 27.0% — excellent return metrics, well above industry norms

Balance Sheet & Leverage

Debt-to-equity: 0.42 — moderate leverage, manageable

Dividend Yield: 0.85% — consistent, though not high

Cash Flow & Efficiency

Strong operating margins and disciplined capital allocation

Healthy cash generation across geographies

💰 Valuation Metrics

Metric Value Interpretation

P/E Ratio 63.1 High — premium valuation vs industry PE of 34.0

P/B Ratio ~16.8 Expensive — reflects strong investor confidence

PEG Ratio 2.98 Overvalued relative to growth

Intrinsic Value Below CMP Stock appears stretched at current levels

🧠 Business Model & Competitive Edge

Core Business: Branded generics and specialty pharma across India, US, Brazil, Germany

Segments: Cardiovascular, gastro, neuro-psychiatric, anti-diabetic, and oncology

Strengths

Strong domestic franchise and global footprint

Recent margin expansion and US recovery driving growth

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Strategic acquisitions (e.g., stake in JB Chemicals) to boost portfolio

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Challenges

High valuation may limit upside

RSI of 79.4 — overbought zone, caution warranted

📉 Technical & Sentiment Indicators

MACD: 97.6 — bullish momentum

Volume surge — strong buying interest

DMA 50 & 200: CMP above both — confirms uptrend

FII/DII Activity: Mixed — slight FII reduction, DII increase

🎯 Entry Zone & Long-Term View

Suggested Entry Zone: ₹3,300–₹3,500 — closer to 50 DMA and better valuation support

Long-Term Holding: Suitable for growth-focused investors. Strong fundamentals and global expansion make it a solid long-term bet, but wait for valuation cooling before entry.

Want to see how Torrent Pharma compares with peers like Sun Pharma or Cipla? I can pull up a side-by-side.

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