Biocon Limited

Healthcare — Biotechnology · NSE

₹349.20−₹2.80 (−0.80%)

DalalBaazaar Score

48 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Low

Driven by a very high earnings multiple, which leaves little margin for disappointment.

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:02 pm

Understanding the Business

Company site ↗

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

What does this company do?

Biocon Limited, together with its subsidiaries, manufactures biotechnology products and offers research services in India, the United States, Ireland, rest of the European Union, and internationally.

IndustryBiotechnology

SectorHealthcare

Employees16,447

Annual revenue₹16,780 Cr

How does it make money?

Turns over ₹16,780 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹22 left at the operating level before interest, tax and depreciation. Each of its 16,447 employees supports ₹1.02 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.02 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO 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 2.8% 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 ROE32.0%

What is the outlook?

15 analysts covering the stock expect revenue to grow about 14.8% and earnings to grow about 60.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.8%

Est. earnings growth+60.8%

Analysts15

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +53% while net margin moved -46% 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+53%

Margin effect-46%

DalalBaazaar Score

48/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 1.1% is weak

Quality vs. Valuation

Company Quality

49/ 100

Average

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

Valuation

29/ 100

Expensive

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

103.3x

3Y Median

47.1x

40 monthly readings · mean 60.7x · range 35.4x–146.1x

Sector Median

16.5x

median of 4 sector peers

⚠️Current valuation is approximately 119% above its 3y median of 47.1x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 524% above the peer median of 16.5x.

vs. its own history

Expensive

47.1x median over 40 months · +119%

vs. sector peers

Expensive

16.5x median of 4 peers · +524%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

19.2x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 14% over 3 years.
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 · 1 high · 2 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.5x — little room if earnings dip.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 3.1x to 1.5x.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 36% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹82 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

The debt load needs earnings to hold up
Debt is 4.2x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 119% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
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.

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

1Revenue growth stays above 12% a year✓ 15.3% CAGR
Latest reported year was 10.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 20%✓ 21.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 4.2x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Interest cover stays above 3x✗ 1.5x
How much operating profit can fall before interest stops being comfortably covered.
5Free cash flow remains positive✓ ₹82 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

7 / 12 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
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 3 neutral · 3 weak

Market Cap

₹57,190 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

103.3x

Expensive

Expensive — verify against sector peers

P/B Ratio

1.66x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹3.38

Profitable

Profitable on a per-share basis

ROE

1.1%

Weak

Weak capital efficiency

ROCE

2.8%

Weak

Low return on total capital employed

Debt/Equity

0.42x

Low

Conservative leverage

Revenue Growth (YoY)

10.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

234.6%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.14%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹82 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

31.9x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

6.9%

Average

Average margins

Net Margin

2.9%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.22

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.32

Defensive

Steadier than the market

52W Range Position

11%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

368.7 / 392.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

17.1

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹10,934 Cr	₹14,196 Cr	₹15,052 Cr	₹16,780 Cr	+15.3%
EBITDA	₹2,529 Cr	₹3,032 Cr	₹3,360 Cr	₹3,653 Cr	+13.0%
EBITDA Margin	23.1%	21.4%	22.3%	21.8%	—
PAT (Net Profit)	₹463 Cr	₹1,023 Cr	₹1,013 Cr	₹386 Cr	-5.9%
EPS	₹3.87	₹8.54	₹8.46	₹2.82	-10.0%
ROE	2.6%	5.2%	4.7%	1.1%	—
ROCE	3.0%	6.1%	6.2%	2.8%	—
Total Debt	₹18,019 Cr	₹16,277 Cr	₹18,362 Cr	₹15,434 Cr	-5.0%
Free Cash Flow	₹126 Cr	₹1,022 Cr	₹1,718 Cr	₹82 Cr	-13.3%

🟢 Revenue has grown at 15.3% a year over 3 years.

🟢 EBITDA has grown at 13.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.1% to 21.8% over 3 years (-1.4 pts).

🔴 PAT (Net Profit) has shrunk at 5.9% a year over 3 years.

🔴 EPS has shrunk at 10.0% a year over 3 years.

🔴 ROE has fallen from 2.6% to 1.1% over 3 years (-1.5 pts).

🟡 ROCE has held roughly flat at 2.8% over 3 years.

🟢 Total Debt has shrunk at 5.0% a year over 3 years.

🔴 Free Cash Flow has shrunk at 13.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹63,651 Cr

Total Liabilities

₹27,029 Cr

Cash & Equivalents

₹2,416 Cr

Operating Cash Flow

₹1,994 Cr

Capex

-₹1,912 Cr

Shareholding (proxy)

Institutional Holding

32.0%

Insider Holding

48.1%

Corporate Actions

Next Earnings

11 Nov 2026

Dividend Rate

₹0.5

Ex-Dividend Date

03 Jul 2026

Analyst Consensus

Recommendations

9 Buy · 3 Hold · 6 Sell

Target Price (Mean)

₹440.68

+26.2% vs CMP

Target Range

₹326 – ₹534

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

4 mixed2 general

Biocon Share Price Near Low; Fundamentals Under Spotlight

Univest, 13 Oct

Biocon Secures Pebrilzo Launch Dates; Shares Fall 0.94%

HDFC Sky, 14 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

BIOCON Forecast — Price Target — Prediction for 2027

TradingView, 25 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Biocon gains 3%, stock nears record high; should you buy, hold or sell?

Business Standard, 16 Jul

Biocon shares gain 2.05%, trading at Rs 420.45

Moneycontrol.com, 18 AugPrice 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.

Stock In Focus: Biocon Share Price Rises 3% After This Block Deal; Details Inside

NDTV Profit, 09 SeptPrice 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.

Watch Items

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

StrongFinancial Health

MiddlingBusiness Quality · Risk

WeakGrowth · Profitability · Valuation

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. 1 high-severity red flag sits above this conclusion and should be read first.

2 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x · see Key things to watch ↑