WOCKPHARMA - Investment Analysis

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

Investment Rating: 2.4

💊 Fundamental Analysis of Wockhardt Ltd (WOCKPHARMA)

(Pharmaceutical company with global operations in generics, biotech, and specialty drugs)

✅ Positives

Technical Momentum

MACD: +12.7 — bullish crossover, short-term momentum

Price above DMA 50 & 200 — positive trend continuation

RSI: 49.1 — neutral zone, potential for upward movement

Institutional Interest

FII Hold ↑ 0.47%, DII Hold ↑ 0.42% — increasing institutional confidence

Valuation Opportunity

Price: ₹1,697 vs Book Value: ₹268 — ~6.3x book, high but typical for pharma with IP assets

52W Index: 83.3% — strong recovery from lows, market optimism

⚠️ Major Concerns

Weak Profitability

ROCE: 3.75%, ROE: -1.22% — poor capital efficiency

EPS: -₹2.89, PAT Qtr: -₹25 Cr vs Prev Qtr: ₹14 Cr — volatile earnings

Qtr Profit Var: -80.4% — sharp decline, raises red flags

No Dividend

Dividend Yield: 0.00% — not rewarding shareholders currently

Valuation Unclear

P/E & PEG Ratio: Not available — due to negative earnings

Makes valuation benchmarking difficult

Moderate Leverage

Debt-to-Equity: 0.46 — manageable but needs monitoring

📉 Ideal Entry Price Zone

Entry Zone: ₹1,450–₹1,550

Offers better margin of safety near DMA 50

Only consider entry if earnings stabilize and ROE turns positive

🧭 Long-Term Investment Outlook

Wockhardt is a high-risk, turnaround candidate. While it has global assets and IP, its financial metrics are weak, and earnings volatility makes it unsuitable for conservative long-term investors. It may appeal to speculative investors betting on a pharma rebound or restructuring.

Holding Period: 1–2 years (only if turnaround visible)

Reassess if ROE turns positive and EPS becomes consistently positive

Watch for regulatory approvals, product launches, and margin recovery

🚪 Exit Strategy (If Already Holding)

Partial Exit Zone: ₹1,750–₹1,850

Near recent highs and psychological resistance

Full Exit

If ROE remains negative and losses persist

If price breaks below ₹1,500 and fails to recover

If institutional interest reverses and volumes dry up

Reinvest: Only if ROCE improves to >10% and EPS turns positive for 2+ quarters

Would you like a comparison with peers like Lupin, Cadila, or Glenmark to assess relative strength and alternatives in the pharma space?

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