Makers Laboratories Limited

Healthcare — Drug Manufacturers - Specialty & Generic · NSE

₹208.90+₹5.75 (+2.83%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, 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. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:49 pm

Understanding the Business

Company site ↗

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

What does this company do?

Makers Laboratories Limited, an integrated pharmaceutical company, manufactures and markets formulations in India. It operates in two segments, Pharmaceutical and Chemical Manufacturing.

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Employees114

Annual revenue₹140 Cr

How does it make money?

Turns over ₹140 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 114 employees supports ₹1.22 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.22 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 9.0% 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?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +38% while net margin moved -136% 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+38%

Margin effect-136%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of 0.22 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

59/ 100

Average

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

Valuation

58/ 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

36.1x

Sector Median

33.3x

median of 4 sector peers

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

vs. its own history

Not enough price and earnings history

vs. sector peers

Fair

33.3x median of 4 peers · +8%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

7.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 5.6% to 11.7% over 3 years.
Debt is being paid down
Total debt is down 54% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from -6.9% to 3.2%.
Return on capital is rising
ROCE has improved from 1.0% to 9.0%.

🔴 What Needs Attention0

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

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 5.00x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 5.6% to 11.7%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 54% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 5.00x. Interest is payable whether or not the business has a good year.
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

1Revenue growth stays above 9% a year✓ 11.4% CAGR
Latest reported year was 22.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 10%✓ 11.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹11 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✓ 9.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 10 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

Price history

Quick Metrics

4 good · 5 neutral · 2 weak

Market Cap

₹123 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

36.1x

Fair

Fairly valued against the generic band

P/B Ratio

1.69x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.79

Profitable

Profitable on a per-share basis

ROE

3.2%

Weak

Weak capital efficiency

ROCE

9.0%

Moderate

Moderate return on the capital in the business

Debt/Equity

5.00x

High

High leverage

Revenue Growth (YoY)

22.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

244.6%

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

₹11 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

13.6%

Average

Average margins

Net Margin

2.3%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.56

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.22

Defensive

Steadier than the market

52W Range Position

68%

Mid-range

Technical Snapshot

RSI (14)

66.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹101 Cr	₹104 Cr	₹120 Cr	₹140 Cr	+11.4%
EBITDA	₹6 Cr	₹3 Cr	₹10 Cr	₹16 Cr	+42.2%
EBITDA Margin	5.6%	2.6%	8.3%	11.7%	—
PAT (Net Profit)	-₹5 Cr	-₹6 Cr	₹7 Cr	₹2 Cr	—
EPS	₹-7.9	₹-10.62	₹12.7	₹3.99	—
ROE	-6.9%	-9.9%	10.6%	3.2%	—
ROCE	1.0%	-1.6%	11.6%	9.0%	—
Total Debt	₹13 Cr	₹19 Cr	₹5 Cr	₹6 Cr	-23.0%
Free Cash Flow	-₹22 Cr	-₹6 Cr	-₹8 Cr	₹11 Cr	—

🟢 Revenue has grown at 11.4% a year over 3 years.

🟢 EBITDA has grown at 42.2% a year over 3 years.

🟢 EBITDA Margin has risen from 5.6% to 11.7% over 3 years (+6.1 pts).

🟢 PAT (Net Profit) has turned positive, from -₹5 Cr to ₹2 Cr.

🟢 EPS has turned positive, from ₹-7.9 to ₹3.99.

🟢 ROE has risen from -6.9% to 3.2% over 3 years (+10.1 pts).

🟢 ROCE has risen from 1.0% to 9.0% over 3 years (+8.0 pts).

🟢 Total Debt has shrunk at 23.0% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹22 Cr to ₹11 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹167 Cr

Total Liabilities

₹44 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹14 Cr

Capex

-₹4 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

67.5%

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 positive2 mixed1 negative2 general

Makers Laboratories Share Price: Price Rise and Valuation

Univest, 24 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.

Makers Laboratories Ltd. Financials – Balance Sheet, Profit & Loss, Cash Flow

Value Research, 28 Aug

Makers Laboratories Ltd is Rated Hold

MarketsMojo, 01 Oct

Makers Laboratories FY26 profit falls 78.5% on higher costs

scanx.trade, 26 MayResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Makers Laboratories Share Price rise: fundamentals and peers

Univest, 03 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.

Prism Johnson consolidated net profit rises 4003.54% in the June 2026 quarter

Business Standard, 07 AugResults

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

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Growth

MiddlingProfitability · Valuation

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

All 5 tripwires holding · see Key things to watch ↑