The Indian Pharmaceutical industry has experienced significant growth and a positive outlook in 2023. The sector has expanded its global footprint, with India being the largest provider of generic medications worldwide, occupying a 20 percent share of the global supply by volume.
The pharmaceutical industry has been growing rapidly in recent years due to several factors such as increasing demand for generic drugs, growing healthcare infrastructure, and favourable government policies. The Indian pharmaceutical market continues to clock a growth of 9 to 10 percent.
Listed below are such pharma stocks with a PEG ratio of less than 1:
Albert David Ltd
With a market capitalization of Rs. 735 crores, the shares of Albert David started Friday’s trading on a higher note at Rs. 1,329 compared to its previous close of Rs. 1,307. During the trading session, the shares hit a low of Rs. 1,275, making a loss of 2 percent and closed the day at Rs. 1,279 apiece.
Coming onto the company’s financial statements, the revenue decreased by 5 percent from Rs. 93 crores during the September quarter to Rs. 88 crores in the December quarter. In addition, the net profits declined by 5 percent from Rs. 20 crores to Rs. 19 crores during the same period.
Looking at the company’s important financial ratios, the return on equity was recorded at 12.24 percent during FY22-23 and the return on capital employed was at 16.36 percent during the same period. Moreover, the net profit margin was at 10.59 percent in FY22-23.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 11.5 times during FY22-23 compared to the industry average of 33.2 times and the PEG ratio for the same period stands at 0.33 times, which means the market has underestimated its value with its projected earning potential.
Shukra Pharmaceuticals Ltd
With a market capitalization of Rs. 288 crores, the shares of Shukra Pharmaceuticals started Friday’s trading on a higher note at Rs. 304.25 compared to its previous close of Rs. 289.80. Within a few minutes of the opening bell, the shares clocked a 5 percent upper circuit at Rs. 304.25, also recorded as the company’s fresh 52-week high.
Coming onto the company’s financial statements, the revenue decreased by 23 percent from Rs. 24.64 crores during the September quarter to Rs. 18.89 crores in the December quarter. On a contrasting note, the net profits magnified by 100 percent from Rs. 4.71 crores to Rs. 9.42 crores during the same period.
Looking at the company’s important financial ratios, the return on equity was recorded at 21.18 percent during FY22-23 and the return on capital employed was at 18.84 percent during the same period. Moreover, the net profit margin was at 7.50 percent in FY22-23.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 15.5 times during FY22-23 compared to the industry average of 33.2 times and the PEG ratio for the same period stands at 0.29 times, which means the market has underestimated its value with its projected earning potential.
Marksans Pharma Ltd
With a market capitalization of Rs. 7,085 crores, the shares of Marksans Pharma started Friday’s trading on a higher note at Rs. 156 compared to its previous close of Rs. 152.50. During the trading session, the shares hit a high of Rs. 157, gaining of around 2 percent and closed the day at Rs. 156 apiece.
Coming onto the company’s financial statements, the revenue increased by 10 percent from Rs. 531 crores during the September quarter to Rs. 586 crores in the December quarter. On a contrasting note, the net profits decreased marginally by 1 percent from Rs. 84 crores to Rs. 83 crores during the same period.
Looking at the company’s important financial ratios, the return on equity was recorded at 18 percent during FY22-23 and the return on capital employed was at 21.77 percent during the same period. Moreover, the net profit margin was at 14.33 percent in FY22-23.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 22.7 times during FY22-23 compared to the industry average of 33.2 times and the PEG ratio for the same period stands at 0.44 times, which means the market has underestimated its value with its projected earning potential.
Glenmark Life Sciences Ltd
With a market capitalization of Rs. 10,494 crores, the shares of Glenmark Life Sciences started Friday’s trading on a flatter note at Rs. 925. During the trading session, the shares hit a low of Rs. 904, making a loss of around 2 percent and closed the day at Rs. 920 apiece.
Coming onto the company’s financial statements, the revenue decreased marginally by 1 percent from Rs. 595 crores during the September quarter to Rs. 573 crores in the December quarter. On the other hand, the net profits remained constant at Rs. 119 crores during the same period.
Looking at the company’s important financial ratios, the return on equity was recorded at 22.28 percent during FY22-23 and the return on capital employed was at 29.86 percent during the same period. Moreover, the net profit margin was at 21.61 percent in FY22-23.
Furthermore, the share is considered to be undervalued as the PE ratio stands at 21 times during FY22-23 compared to the industry average of 33.2 times and the PEG ratio for the same period stands at 0.07 times, which means the market has underestimated its value with its projected earning potential.
Written By Vaibhav Patil
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