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ZYDUSLIFE - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.4
| Stock Code | ZYDUSLIFE | Market Cap | 88,367 Cr. | Current Price | 878 ₹ | High / Low | 1,059 ₹ |
| Stock P/E | 18.3 | Book Value | 215 ₹ | Dividend Yield | 1.25 % | ROCE | 30.6 % |
| ROE | 31.2 % | Face Value | 1.00 ₹ | DMA 50 | 913 ₹ | DMA 200 | 946 ₹ |
| Chg in FII Hold | -0.28 % | Chg in DII Hold | 0.22 % | PAT Qtr | 1,157 Cr. | PAT Prev Qtr | 385 Cr. |
| RSI | 39.6 | MACD | -9.15 | Volume | 1,81,749 | Avg Vol 1Wk | 4,27,486 |
| Low price | 795 ₹ | High price | 1,059 ₹ | PEG Ratio | 0.25 | Debt to equity | 0.35 |
| 52w Index | 31.5 % | Qtr Profit Var | 46.4 % | EPS | 48.0 ₹ | Industry PE | 29.0 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT surged from 385 Cr. to 1,157 Cr. (+46.4% YoY), showing strong earnings momentum.
- Margins & Returns: ROCE at 30.6% and ROE at 31.2% highlight excellent efficiency and profitability.
- Debt Ratios: Debt-to-equity at 0.35 reflects moderate leverage, manageable within industry norms.
- Cash Flows: Dividend yield of 1.25% provides steady shareholder returns, supported by strong cash generation.
💹 Valuation Indicators
- P/E Ratio: 18.3 vs industry average of 29.0 → trades at a discount.
- P/B Ratio: Current Price / Book Value ≈ 4.08 → moderately above intrinsic value.
- PEG Ratio: 0.25 → indicates undervaluation relative to growth.
- Intrinsic Value: Current price (878 ₹) appears attractive given strong earnings and efficiency ratios.
🏢 Business Model & Competitive Advantage
- Leading pharmaceutical company with diversified portfolio across generics, specialty drugs, and vaccines.
- Strong efficiency ratios (ROCE, ROE) provide competitive edge.
- Global presence enhances resilience and growth opportunities.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 850 ₹ – 880 ₹, near current support levels.
- Long-Term Holding: Strong candidate for long-term portfolios focused on healthcare and pharmaceuticals; staggered accumulation recommended.
✅ Positive
- Strong ROCE (30.6%) and ROE (31.2%) highlight efficiency.
- Quarterly PAT growth from 385 Cr. to 1,157 Cr. shows robust momentum.
- DII holdings increased (+0.22%), reflecting domestic institutional confidence.
⚠️ Limitation
- Debt-to-equity ratio (0.35) is moderate and requires monitoring.
- P/B ratio (4.08) signals valuation above book value.
- Dividend yield of 1.25% is modest compared to some peers.
📉 Company Negative News
- Stock trading below both 50 DMA (913 ₹) and 200 DMA (946 ₹), indicating weak momentum.
- RSI at 39.6 and negative MACD (-9.15) suggest bearish technical outlook.
- FII holdings decreased (-0.28%), showing reduced foreign investor confidence.
📈 Company Positive News
- Quarterly PAT surged significantly, showing strong earnings recovery.
- EPS of 48.0 ₹ supports valuation strength.
- DII holdings increased (+0.22%), supporting domestic confidence.
🏭 Industry
- Industry P/E at 29.0 indicates sector trades at higher multiples.
- Pharmaceutical sector benefits from global demand and healthcare spending.
- ZYDUSLIFE trades at a discount, offering value with strong fundamentals.
🔎 Conclusion
ZYDUSLIFE demonstrates strong fundamentals with excellent efficiency, robust profit growth, and global presence. Despite modest dividend yield and weak technical signals, the stock trades at a discount compared to industry peers, making it attractive for long-term investors. Entry is advisable near 850 ₹ – 880 ₹, with staggered accumulation to mitigate risks. Overall, ZYDUSLIFE offers a compelling opportunity in the pharmaceutical sector.