COHANCE - Investment Analysis

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

Investment Rating: 2.6

🧬 Fundamental Analysis: Cohance Lifesciences Ltd. (COHANCE)

Cohance Lifesciences operates in the pharmaceutical and life sciences space, but current financials and valuation metrics suggest significant caution for long-term investors.

Metric Value Implication

Market Cap ₹38,656 Cr Mid-cap; potential for growth but higher volatility

Stock P/E 146 Extremely overvalued vs. industry PE of 34.0

PEG Ratio -11.2 Negative due to declining earnings; red flag

ROE / ROCE 14.1% / 16.8% Moderate; not compelling for long-term compounding

Dividend Yield 0.00% No income generation; purely growth-oriented

Debt-to-Equity 0.16 Low debt; financial flexibility

EPS ₹10.5 Weak earnings base relative to price

Qtr Profit Var -27.4% Sharp decline in profitability

FII/DII Holding Change -3.82% / -5.20% Heavy institutional selling — sentiment turning negative

📉 Technical Analysis

Current Price: ₹1,012

DMA 50 / DMA 200: ₹1,037 / ₹1,059 → Trading below both; bearish trend

RSI: 46.1 → Neutral zone; no strong momentum

MACD: +2.33 → Mild bullish crossover, but not convincing

Volume: Below average; waning interest

💰 Ideal Entry Price Zone

Given the weak fundamentals and technical setup

Ideal Entry Zone: ₹900–₹950

This range aligns with recent support and offers better downside protection

Avoid entry above ₹1,050 unless earnings stabilize and valuation improves

🌱 Long-Term Investment Outlook

Why it’s a weak candidate currently

PEG ratio negative — earnings contraction

P/E of 146 — unjustifiable valuation

ROE/ROCE below ideal thresholds for long-term compounding

No dividend — not suitable for income portfolios

Institutional selling — confidence erosion

Potential upside only if

Profitability rebounds sharply

Valuation compresses to more reasonable levels

Strategic developments or product pipeline improves visibility

🏁 Exit Strategy / Holding Period

If you already hold COHANCE

Holding Period: Short-term (6–12 months) unless earnings recover

Exit Strategy

Consider exiting near ₹1,050–₹1,100 if technical bounce occurs

Reassess if quarterly profits continue to decline or valuation remains disconnected

Hold only if ROCE improves above 20% and PEG turns positive

Would you like a comparison with more stable pharma plays like Divi’s Labs, Cipla, or Dr. Reddy’s to explore better long-term alternatives?

Edit in a page