Beta Drugs Limited

Healthcare — Drug Manufacturers - Specialty & Generic · NSE

₹1,790.00+₹39.70 (+2.27%)

DalalBaazaar Score

60 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

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

In simple words: Strong business and financial position, 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, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Beta Drugs Limited develops, manufactures, and sells anti-cancer bulk drugs and finished dosages in India. The company offers cosmeceutical and oncology products. It also manufactures active pharmaceutical ingredients (API) and pharmaceutical formulation intermediates (PFI).

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Employees455

Annual revenue₹385 Cr

How does it make money?

Turns over ₹385 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹22 left at the operating level before interest, tax and depreciation. Each of its 455 employees supports ₹84.6 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹84.6 lakh

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?Some evidence

ROCE of 17.9% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

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 +69% while net margin moved -20% 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+69%

Margin effect-20%

DalalBaazaar Score

60/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 26.4x already prices in growth
✓ P/E is 40% below its own historical median of 43.7x — cheap by its own standards
✗ P/B of 7.41x is a steep premium to book

Quality vs. Valuation

Company Quality

61/ 100

Average

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

Valuation

60/ 100

Fair

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

26.4x

3Y Median

43.7x

40 monthly readings · mean 43.1x · range 25.0x–57.3x

Sector Median

33.3x

median of 4 sector peers

🟢Current valuation is approximately 40% below its 3y median of 43.7x. 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 21% below the peer median of 33.3x.

vs. its own history

Cheap

43.7x median over 40 months · -40%

vs. sector peers

Cheap

33.3x median of 4 peers · -21%

vs. generic bands

Fair

15x–35x

EV/EBITDA

21.2x

PEG

2.50

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 25.0% to 16.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 32.0% to 17.9% — often a sign of competition or overexpansion.

Red Flags

6 items require attention · 2 high · 4 watch

🔴Debt has risen sharplyFinancial
Total debt is up 627% over 3 years, from ₹20 Cr to ₹148 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 143% against revenue up 69% — stock may not be moving.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 9.5x to 4.6x.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹16 Cr in the latest year.
🟡Receivables growing faster than salesFinancial
Receivables up 90% against revenue up 69% — sales are being booked faster than they are collected.
🟡Low reported insider holdingOwnership
Reported insider holding is 0.0%. For Indian companies this field is an unreliable proxy — check the official promoter shareholding in the exchange filing.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 40% 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 21% 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?

Sales are being booked faster than collected
Receivables are up 90% against revenue up 69%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 25.0% to 16.9%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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 14% a year✓ 19.2% CAGR
Latest reported year was 25.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 20%✓ 22.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹16 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 15%✓ 17.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 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 · 4 neutral · 2 weak

Market Cap

₹1,815 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

26.4x

Fair

Fairly valued against the generic band

P/B Ratio

7.41x

Rich

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

EPS (TTM)

₹67.9

Profitable

Profitable on a per-share basis

ROE

16.9%

Strong

Strong capital efficiency

ROCE

17.9%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.60x

Moderate

Moderate leverage

Revenue Growth (YoY)

25.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

27.5%

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

-₹16 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

18.3%

Good

Healthy core-business profitability

Net Margin

11.1%

Good

Strong bottom-line conversion

Current Ratio

3.10

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.37

Defensive

Steadier than the market

52W Range Position

44%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1972.3 / 2164.0

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

28.1

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹227 Cr	₹296 Cr	₹362 Cr	₹385 Cr	+19.2%
EBITDA	₹54 Cr	₹61 Cr	₹81 Cr	₹87 Cr	+17.2%
EBITDA Margin	23.7%	20.7%	22.3%	22.5%	—
PAT (Net Profit)	₹31 Cr	₹36 Cr	₹42 Cr	₹41 Cr	+10.5%
EPS	₹30.43	₹37.9	₹42.02	₹40.92	+10.4%
ROE	25.0%	23.2%	21.5%	16.9%	—
ROCE	32.0%	30.4%	19.1%	17.9%	—
Total Debt	₹20 Cr	₹15 Cr	₹138 Cr	₹148 Cr	+93.7%
Free Cash Flow	₹5 Cr	₹19 Cr	-₹1 Cr	-₹16 Cr	—

🟢 Revenue has grown at 19.2% a year over 3 years.

🟢 EBITDA has grown at 17.2% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.7% to 22.5% over 3 years (-1.2 pts).

🟢 PAT (Net Profit) has grown at 10.5% a year over 3 years.

🟢 EPS has grown at 10.4% a year over 3 years.

🔴 ROE has fallen from 25.0% to 16.9% over 3 years (-8.1 pts).

🔴 ROCE has fallen from 32.0% to 17.9% over 3 years (-14.1 pts).

🔴 Total Debt has grown at 93.7% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹5 Cr to -₹16 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹496 Cr

Total Liabilities

₹251 Cr

Cash & Equivalents

₹125 Cr

Operating Cash Flow

₹37 Cr

Capex

-₹53 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

0.0%

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

1 positive3 mixed2 general

Beta Drugs Share Price gains as fundamentals stay strong

Univest, 15 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Beta Drugs (NSE:BETA) Ticks All The Boxes When It Comes To Earnings Growth

Simply Wall Street, 14 OctResults

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

Compare with

Equitymaster, 16 Oct

Beta Drugs Stock Analysis and Key Price Levels

Kalkine India, 09 Oct

Beta Drugs Q1FY27 net profit rises 41% to ₹165 Mn on strong sales

scanx.trade, 20 JulResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Beta Drugs - Ashish Kacholia's Q1 portfolio: 13 stocks the ace investor bought, sold or likely exited. Full list

The Economic Times, 24 JulResults

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

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
Reported insider holding is low — cross-check the official promoter shareholding % in the company's exchange filing.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongBusiness Quality

MiddlingFinancial Health · Growth · Profitability · Valuation · 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.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑