Innova Captab Limited

Healthcare — Drug Manufacturers - Specialty & Generic · NSE

₹1,013.00−₹10.80 (−1.05%)

DalalBaazaar Score

68 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

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 Innova Captab Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Innova Captab Limited, an integrated pharmaceutical company, engages in the research and development, manufacture, distribution, and marketing of drugs and pharmaceutical products in India and internationally.

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Annual revenue₹1,604 Cr

How does it make money?

Turns over ₹1,604 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹15 left at the operating level before interest, tax and depreciation.

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 15.3% 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 is the outlook?

2 analysts covering the stock expect revenue to grow about 20.3% and earnings to grow about 35.0% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+20.3%

Est. earnings growth+35.0%

Analysts2

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 +73% 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+73%

Margin effect+20%

DalalBaazaar Score

68/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 37.6x already prices in growth
• P/E is close to its own historical median of 41.7x
✗ P/B of 5.31x is a steep premium to book

Quality vs. Valuation

Company Quality

74/ 100

Good

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

Valuation

50/ 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

37.6x

3Y Median

41.7x

36 monthly readings · mean 42.0x · range 29.8x–59.8x

Sector Median

33.3x

median of 4 sector peers

🟡Currently trading close to its 3y median of 41.7x — the market is paying about what it usually pays for this company.

🟡Against its sector it is priced broadly in line with the peer median of 33.3x.

vs. its own history

Fair

41.7x median over 36 months · -10%

vs. sector peers

Fair

33.3x median of 4 peers · +13%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

24.7x

PEG

1.37

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 13.0% to 15.5% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 24.6% to 12.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 25.9% to 15.3% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Inventory building faster than salesFinancial
Inventory up 141% against revenue up 73% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 45% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 13.0% to 15.5%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹48 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?

Returns on shareholder capital are falling
ROE has dropped from 24.6% to 12.9%. 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
Small 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

1Revenue growth stays above 15% a year✓ 20.1% CAGR
Latest reported year was 33.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 13%✓ 15.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹48 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 12%✓ 15.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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

6 good · 4 neutral · 1 weak

Market Cap

₹5,797 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

37.6x

Fair

Fairly valued against the generic band

P/B Ratio

5.31x

Rich

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

EPS (TTM)

₹26.91

Profitable

Profitable on a per-share basis

ROE

12.9%

Moderate

Moderate capital efficiency

ROCE

15.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.32x

Low

Conservative leverage

Revenue Growth (YoY)

33.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

42.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.39%

Modest

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

Free Cash Flow

₹48 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

22.3x

Improving

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

Operating Margin

13.0%

Average

Average margins

Net Margin

8.8%

Average

Average bottom-line conversion

Current Ratio

1.87

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.03

Defensive

Steadier than the market

52W Range Position

53%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1164.3 / 1111.8

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

10.0

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹925 Cr	₹1,077 Cr	₹1,234 Cr	₹1,604 Cr	+20.1%
EBITDA	₹120 Cr	₹168 Cr	₹200 Cr	₹248 Cr	+27.4%
EBITDA Margin	13.0%	15.6%	16.2%	15.5%	—
PAT (Net Profit)	₹68 Cr	₹94 Cr	₹128 Cr	₹141 Cr	+27.5%
EPS	₹11.87	₹18.66	₹22.41	₹24.63	+27.5%
ROE	24.6%	11.4%	13.4%	12.9%	—
ROCE	25.9%	14.3%	14.1%	15.3%	—
Total Debt	₹237 Cr	₹245 Cr	₹338 Cr	₹344 Cr	+13.2%
Free Cash Flow	-₹12 Cr	-₹141 Cr	-₹109 Cr	₹48 Cr	—

🟢 Revenue has grown at 20.1% a year over 3 years.

🟢 EBITDA has grown at 27.4% a year over 3 years.

🟢 EBITDA Margin has risen from 13.0% to 15.5% over 3 years (+2.5 pts).

🟢 PAT (Net Profit) has grown at 27.5% a year over 3 years.

🟢 EPS has grown at 27.5% a year over 3 years.

🔴 ROE has fallen from 24.6% to 12.9% over 3 years (-11.7 pts).

🔴 ROCE has fallen from 25.9% to 15.3% over 3 years (-10.7 pts).

🔴 Total Debt has grown at 13.2% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹12 Cr to ₹48 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,837 Cr

Total Liabilities

₹747 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹117 Cr

Capex

-₹68 Cr

Shareholding (proxy)

Institutional Holding

20.7%

Insider Holding

68.4%

Corporate Actions

Dividend Rate

₹4

Ex-Dividend Date

30 Jan 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,116

+10.2% vs CMP

Target Range

₹1,100 – ₹1,132

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

3 mixed3 general

Innova Captab (NSEI:INNOVACAP) Stock Forecast & Analyst Predictions

Simply Wall Street, 08 OctAnalyst view

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

Innova Captab FY26 Earnings Call: Revenue Hits ₹1,630 Crores, Jammu Nears EBITDA Breakeven

scanx.trade, 08 OctResults

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

Innova Captab Share Price News: Mid Cap Pharma Moves Lower

Univest, 30 SeptPrice 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.

Compare with

Equitymaster, 16 Oct

INNOVACAP Historical Data

Equitypandit, 24 Feb

MCX, Thyrocare, Innova Captab: Top stocks to trade — key levels, target prices & stop loss

Business Today, 12 Aug

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 · Growth

MiddlingBusiness Quality · Profitability · Risk

WeakValuation

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑