Everest Organics Limited

Healthcare — Drug Manufacturers - Specialty & Generic · BSE

₹230.00+₹5.60 (+2.50%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by micro-cap size, which brings thin liquidity, falling profits.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Everest Organics Limited engages in the manufacture and sale of active pharmaceutical ingredients and its intermediaries in India. It is also involved in the manufacturing of bulk drugs-related business. The company exports its products.

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Employees316

Annual revenue₹196 Cr

How does it make money?

Turns over ₹196 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 316 employees supports ₹62.1 lakh of revenue a year, the signature of a people-led business.

EBITDA margin10.7%

Net margin2.8%

Revenue / employee₹62.1 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.

SUN PHARMACEUTICAL IND LP/E 34.9x · ROE 14.5%

DR. REDDY S LABORATORIESP/E 31.0x · ROE 8.8%

CIPLA LTDP/E 31.8x · ROE 9.8%

DIVI S LABORATORIES LTDP/E 83.0x · ROE 17.5%

What is its competitive advantage?Some evidence

ROCE of 15.8% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE15.8%

ROE7.3%

Peer median ROE14.5%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +7% while net margin moved -2939% 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+7%

Margin effect-2939%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 2.3% — barely ahead of inflation
✗ Latest-year revenue growth of -10.1% is below the longer-term trend — momentum is fading
✗ Profit fell 20.7% in the latest year

Quality vs. Valuation

Company Quality

50/ 100

Average

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

Valuation

52/ 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

42.6x

2Y Median

1600.9x

28 monthly readings · mean 1527.8x · range 38.9x–2975.3x

Sector Median

33.3x

median of 4 sector peers

🟢Current valuation is approximately 97% below its 2y median of 1600.9x. 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 28% above the peer median of 33.3x.

vs. its own history

Cheap

1600.9x median over 28 months · -97%

vs. sector peers

Expensive

33.3x median of 4 peers · +28%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

42.6x

P/B

2.98x

EV/EBITDA

13.3x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 1.3% to 10.7% over 3 years.
Return on equity is rising
ROE has improved from -0.4% to 7.3%.
Return on capital is rising
ROCE has improved from 4.7% to 15.8%.
Valuation below its historical average
At 42.6x the stock trades 97% below its own median of 1600.9x.

🔴 What Needs Attention1

Receivables growing faster than sales
Receivables are up 52% against revenue growth of 7% — customers are taking longer to pay.

Red Flags

2 items require attention · 2 watch

🟡Receivables growing faster than salesFinancial
Receivables up 52% against revenue up 7% — sales are being booked faster than they are collected.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 21% 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 1.3% to 10.7%. 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 97% 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.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 52% against revenue up 7%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 28% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 2.3% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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.

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

1EBITDA margin holds above 9%✓ 10.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Interest cover stays above 3x✗ 2.4x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 4% a year✗ 2.3% CAGR
Latest reported year was -10.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

5 / 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

3 good · 4 neutral · 4 weak

Market Cap

₹229 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

42.6x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.98x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.4

Profitable

Profitable on a per-share basis

ROE

7.3%

Weak

Weak capital efficiency

ROCE

15.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.66x

Moderate

Moderate leverage

Revenue Growth (YoY)

-10.1%

Shrinking

Sales are contracting

Profit Growth (YoY)

-20.7%

Falling

Profits are shrinking

Dividend Yield

None

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

Free Cash Flow

₹1 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹230

Operating Margin

6.5%

Average

Average margins

Net Margin

2.7%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.10

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.56

Defensive

Steadier than the market

52W Range Position

10%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

233.8 / 264.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

49.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹183 Cr	₹197 Cr	₹159 Cr	₹196 Cr	+2.3%
EBITDA	₹2 Cr	₹11 Cr	₹8 Cr	₹21 Cr	+104.5%
EBITDA Margin	1.3%	5.7%	4.9%	10.7%	—
PAT (Net Profit)	-₹0 Cr	₹0 Cr	-₹1 Cr	₹6 Cr	—
EPS	₹-0.23	₹0.17	₹-2.97	₹5.7	—
ROE	-0.4%	0.3%	-1.8%	7.3%	—
ROCE	4.7%	8.2%	1.4%	15.8%	—
Total Debt	₹52 Cr	₹58 Cr	₹48 Cr	₹50 Cr	-1.5%
Free Cash Flow	₹5 Cr	₹3 Cr	-₹11 Cr	₹1 Cr	-42.3%

🟢 Revenue has grown at 2.3% a year over 3 years.

🟢 EBITDA has grown at 104.5% a year over 3 years.

🟢 EBITDA Margin has risen from 1.3% to 10.7% over 3 years (+9.3 pts).

🟢 PAT (Net Profit) has turned positive, from -₹0 Cr to ₹6 Cr.

🟢 EPS has turned positive, from ₹-0.23 to ₹5.7.

🟢 ROE has risen from -0.4% to 7.3% over 3 years (+7.7 pts).

🟢 ROCE has risen from 4.7% to 15.8% over 3 years (+11.1 pts).

🟡 Total Debt has been broadly flat over 3 years (-1.5% a year).

🔴 Free Cash Flow has shrunk at 42.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹240 Cr

Total Liabilities

₹164 Cr

Total Debt

₹50 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹4 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.3%

Corporate Actions

Ex-Dividend Date

15 Sept 2022

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

Everest Organics Ltd. (EVERESTO) Share Price Rises 12.78% Today

Univest, 05 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.

Everest Organics adopts FY26 financials at 33rd AGM held virtually

scanx.trade, 30 Sept

ADVANCED ENZYME TECHNOLOGIES Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 15 Oct

Everest Organics schedules 33rd AGM for September 30 via video conferencing

scanx.trade, 09 Sept

MERCURY LAB. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 08 Oct

Q1 results 2026: Vodafone Idea to RVNL among companies to declare Q1 results next week; check full list here

Livemint, 09 AugResults

🟡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

Revenue growth is negative (-10.1%) on the latest reported period — check if this is one-off or a trend.
Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟡Business QualityAdequate11.5/20

🟡Financial HealthAdequate11.7/20

🔴GrowthWeak7.6/20

🟡ProfitabilityModerate7.1/15

🟡ValuationFair8.3/15

🔴RiskHigh4.4/10

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.

This thesis breaks if

✓EBITDA margin holds above 9%10.7%
✗Debt / EBITDA stays below 2x2.4x
✗Interest cover stays above 3x2.4x
✗Revenue growth stays above 4% a year2.3% CAGR
✓Free cash flow remains positive₹1 Cr