Astal Laboratories Limited

Healthcare — Drug Manufacturers - Specialty & Generic · BSE

₹68.30−₹0.10 (−0.15%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

The 60-second version of Astal Laboratories Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Astal Laboratories Limited manufactures and sells pharmaceutical intermediates and bulk drugs in India. The company was formerly known as Macro International Limited and changed its name to Astal Laboratories Limited in April 2024.

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Employees22

Annual revenue₹250 Cr

How does it make money?

Turns over ₹250 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹8 left at the operating level before interest, tax and depreciation. Each of its 22 employees supports ₹11.37 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹11.37 Cr

Who are its competitors?

The closest listed comparisons in its industry are SUN PHARMACEUTICAL IND L, DR. REDDY S LABORATORIES, CIPLA LTD, DIVI S LABORATORIES LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 5.5% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE14.5%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +7197% while net margin moved +1129% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+7197%

Margin effect+1129%

DalalBaazaar Score

59/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of -0.45 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

60/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

75/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

11.1x

3Y Median

53.4x

40 monthly readings · mean 329.1x · range 7.7x–2012.0x

Sector Median

33.3x

median of 4 sector peers

🟢Current valuation is approximately 79% below its 3y median of 53.4x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 67% below the peer median of 33.3x.

vs. its own history

Cheap

53.4x median over 40 months · -79%

vs. sector peers

Cheap

33.3x median of 4 peers · -67%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

16.9x

PEG

0.01

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 1.2% to 8.3% over 3 years.
Return on equity is rising
ROE has improved from 0.3% to 4.4%.
Return on capital is rising
ROCE has improved from 0.6% to 5.5%.
Very low debt
Debt/Equity of 0.15x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 962% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 1.2% to 8.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 79% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 67% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 238% a year✓ 317.9% CAGR
Latest reported year was 298.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 6%✓ 8.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹20 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ 5.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 2 neutral · 4 weak

Market Cap

₹299 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

11.1x

Cheap

Cheap against the generic band

P/B Ratio

5.46x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹6.16

Profitable

Profitable on a per-share basis

ROE

4.4%

Weak

Weak capital efficiency

ROCE

5.5%

Weak

Low return on total capital employed

Debt/Equity

0.15x

Low

Conservative leverage

Revenue Growth (YoY)

298.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

25.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹20 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

10.4%

Average

Average margins

Net Margin

6.8%

Average

Average bottom-line conversion

Current Ratio

1.48

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.45

Defensive

Steadier than the market

52W Range Position

19%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

69.4 / 75.8

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

41.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3 Cr	₹24 Cr	₹64 Cr	₹250 Cr	+317.9%
EBITDA	₹0 Cr	₹1 Cr	₹13 Cr	₹21 Cr	+701.1%
EBITDA Margin	1.2%	4.8%	20.0%	8.3%	—
PAT (Net Profit)	₹0 Cr	₹1 Cr	₹9 Cr	₹15 Cr	+864.4%
EPS	₹0.04	₹1.55	₹8.04	₹7.81	+475.4%
ROE	0.3%	3.4%	24.8%	4.4%	—
ROCE	0.6%	4.6%	34.4%	5.5%	—
Total Debt	—	₹0 Cr	₹13 Cr	₹50 Cr	—
Free Cash Flow	-₹1 Cr	-₹11 Cr	-₹20 Cr	-₹20 Cr	—

🟢 Revenue has grown at 317.9% a year over 3 years.

🟢 EBITDA has grown at 701.1% a year over 3 years.

🟢 EBITDA Margin has risen from 1.2% to 8.3% over 3 years (+7.1 pts).

🟢 PAT (Net Profit) has grown at 864.4% a year over 3 years.

🟢 EPS has grown at 475.4% a year over 3 years.

🟢 ROE has risen from 0.3% to 4.4% over 3 years (+4.1 pts).

🟢 ROCE has risen from 0.6% to 5.5% over 3 years (+4.9 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹519 Cr

Total Liabilities

₹185 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

-₹18 Cr

Capex

-₹2 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

59.0%

Corporate Actions

Ex-Dividend Date

07 Aug 1998

Peer Comparison

Company	P/E	ROE
SUN PHARMACEUTICAL IND L	34.9x	14.5%
DR. REDDY S LABORATORIES	31.0x	8.8%
CIPLA LTD	31.8x	9.8%
DIVI S LABORATORIES LTD	83.0x	17.5%

Recent News

2 mixed4 general

Astal Laboratories promoter ACESO buys 25,417 shares on BSE

scanx.trade, 11 Sept

ASTAL LABORATORIES LIMITED Share Price

Upstox, 05 May

Astal Laboratories eyes pharma unit acquisition, plans Rs. 300 crore fundraise

scanx.trade, 28 JunM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Astal Laboratories Q1 Results: Unaudited financials filed for June 2026

scanx.trade, 16 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Astal Laboratories allots 14.7 lakh shares at ₹40 each

scanx.trade, 12 May

Astal Laboratories schedules 33rd AGM for September 29, 2026

scanx.trade, 31 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Growth · Valuation

MiddlingProfitability

WeakBusiness Quality · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive; ROCE stays above 8% · see Key things to watch ↑