MANKIND - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.8
| Stock Code | MANKIND | Market Cap | 89,131 Cr. | Current Price | 2,163 ₹ | High / Low | 2,727 ₹ |
| Stock P/E | 53.5 | Book Value | 376 ₹ | Dividend Yield | 0.05 % | ROCE | 15.0 % |
| ROE | 13.9 % | Face Value | 1.00 ₹ | DMA 50 | 2,193 ₹ | DMA 200 | 2,340 ₹ |
| Chg in FII Hold | -1.49 % | Chg in DII Hold | 1.35 % | PAT Qtr | 459 Cr. | PAT Prev Qtr | 413 Cr. |
| RSI | 51.0 | MACD | -25.8 | Volume | 7,92,794 | Avg Vol 1Wk | 4,41,417 |
| Low price | 2,047 ₹ | High price | 2,727 ₹ | PEG Ratio | 6.36 | Debt to equity | 0.47 |
| 52w Index | 17.0 % | Qtr Profit Var | -25.2 % | EPS | 40.4 ₹ | Industry PE | 29.2 |
📊 Analysis: Mankind Pharma trades at ₹2,163 with a P/E of 53.5, significantly higher than the industry average of 29.2, indicating steep overvaluation. ROE (13.9%) and ROCE (15.0%) are moderate, showing average efficiency in generating returns. Dividend yield at 0.05% is negligible, making it unattractive for income investors. The PEG ratio (6.36) suggests expensive valuation relative to growth. Technical indicators (RSI 51.0, MACD -25.8) show neutral-to-bearish momentum. PAT has improved sequentially (413 Cr. → 459 Cr.), but quarterly profit variation (-25.2%) highlights earnings volatility. Debt-to-equity at 0.47 indicates moderate leverage.
💡 Entry Price Zone: Ideal entry would be between ₹2,050–₹2,100, closer to the 52-week low (₹2,047) and below DMA 200 (₹2,340), offering better valuation comfort.
📈 Exit / Holding Strategy: If already holding, consider a medium-term horizon (2–3 years) while monitoring profitability. Exit strategy should be triggered if price sustains below ₹2,000 or if ROE/ROCE stagnate. Long-term holding is not recommended unless earnings growth improves and valuation normalizes.
✅ Positive
- Sequential PAT growth (413 Cr. → 459 Cr.).
- DII holdings increased (+1.35%), showing domestic institutional confidence.
- EPS at ₹40.4, reflecting steady earnings power.
⚠️ Limitation
- High P/E (53.5) vs industry average (29.2).
- Weak dividend yield (0.05%), unattractive for income investors.
- PEG ratio (6.36) indicates expensive valuation relative to growth.
📉 Company Negative News
- FII holdings reduced (-1.49%), showing declining foreign investor interest.
- Quarterly profit variation (-25.2%) highlights earnings volatility.
📈 Company Positive News
- Sequential PAT growth despite volatility.
- Stock trading above 52-week low (₹2,047), showing resilience.
🏭 Industry
- Pharma sector has long-term growth potential driven by healthcare demand.
- Industry P/E at 29.2 highlights Mankind Pharma is trading at a steep premium compared to peers.
🔎 Conclusion
Mankind Pharma shows moderate fundamentals but trades at a steep premium with weak dividend yield and earnings volatility. It is not an ideal candidate for long-term investment at current levels. Best strategy: accumulate only near ₹2,050–₹2,100 for medium-term gains. Existing holders should monitor profitability and exit if price drops below ₹2,000 or fundamentals weaken further.