Strides Pharma Science Limited

Healthcare — Drug Manufacturers - Specialty & Generic · NSE

₹1,044.10−₹15.80 (−1.49%)

DalalBaazaar Score

70 / 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, 6:04 pm

Constructive picture on fundamentals. Profitability, leverage and growth metrics are broadly healthy on this snapshot. That said, valuation should still be checked against direct sector peers (not just the generic P/E bands used here) before treating this as a buy signal.

Understanding the Business

Company site ↗

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

What does this company do?

Strides Pharma Science Limited, a pharmaceutical company, engages in the development, manufacturing, and marketing of pharmaceutical products in North America, Australia, Africa, Europe, India, the rest of Asia, and internationally.

IndustryDrug Manufacturers - Specialty & Generic

SectorHealthcare

Employees3,535

Annual revenue₹4,628 Cr

How does it make money?

Turns over ₹4,628 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹22 left at the operating level before interest, tax and depreciation. Each of its 3,535 employees supports ₹1.31 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin21.9%

Net margin12.0%

Revenue / employee₹1.31 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.

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 20.3% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE20.3%

ROE17.9%

Peer median ROE14.5%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 18.7% and earnings to grow about 40.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+18.7%

Est. earnings growth+40.3%

Analysts2

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +28% while net margin moved -314% 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+28%

Margin effect-314%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 15.7x is within a normal band
✗ P/E is 498% above its own historical median of 2.6x — expensive by its own standards

Quality vs. Valuation

Company Quality

77/ 100

Good

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

Valuation

56/ 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

15.7x

1.3Y Median

2.6x

16 monthly readings · mean 6.2x · range 2.1x–18.6x

Sector Median

33.3x

median of 4 sector peers

⚠️Current valuation is approximately 498% above its 1.3y median of 2.6x. 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 53% below the peer median of 33.3x.

vs. its own history

Expensive

2.6x median over 16 months · +498%

vs. sector peers

Cheap

33.3x median of 4 peers · -53%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

15.7x

P/B

3.10x

EV/EBITDA

11.0x

PEG

—

Dividend Yield

0.48%

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from 5.2% to 21.9% over 3 years.
Debt is being paid down
Total debt is down 42% 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 -9.2% to 17.9%.
Return on capital is rising
ROCE has improved from -1.9% to 20.3%.
High return on capital employed
ROCE of 20.3% is the mark of a business that converts capital into profit efficiently.

🔴 What Needs Attention1

Valuation above its historical average
At 15.7x the stock trades 498% above its own median of 2.6x.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 20.3% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 5.2% to 21.9%. 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 42% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 53% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

The price already assumes success
The stock trades 498% 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.
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

1EBITDA margin holds above 20%✓ 21.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 6% a year✓ 8.7% CAGR
Latest reported year was 13.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹285 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 17%✓ 20.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

12 / 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

7 good · 4 neutral · 0 weak

Market Cap

₹9,624 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

15.7x

Fair

Fairly valued against the generic band

P/B Ratio

3.10x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹66.55

Profitable

Profitable on a per-share basis

ROE

17.9%

Strong

Strong capital efficiency

ROCE

20.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.56x

Low

Conservative leverage

Revenue Growth (YoY)

13.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

57.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.48%

Modest

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

Free Cash Flow

₹285 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹1,044.1

P/E (Forward)

10.9x

Improving

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

Operating Margin

13.7%

Average

Average margins

Net Margin

12.3%

Good

Strong bottom-line conversion

Current Ratio

1.25

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.37

Defensive

Steadier than the market

52W Range Position

56%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1132.5 / 1083.0

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

20.3

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3,608 Cr	₹3,730 Cr	₹4,392 Cr	₹4,628 Cr	+8.7%
EBITDA	₹188 Cr	₹501 Cr	₹790 Cr	₹1,014 Cr	+75.5%
EBITDA Margin	5.2%	13.4%	18.0%	21.9%	—
PAT (Net Profit)	-₹203 Cr	-₹71 Cr	₹3,593 Cr	₹556 Cr	—
EPS	₹-22.49	₹-7.76	₹390.5	₹60.34	—
ROE	-9.2%	-3.3%	140.8%	17.9%	—
ROCE	-1.9%	4.2%	20.1%	20.3%	—
Total Debt	₹3,030 Cr	₹2,517 Cr	₹1,880 Cr	₹1,758 Cr	-16.6%
Free Cash Flow	-₹51 Cr	₹583 Cr	₹437 Cr	₹285 Cr	—

🟢 Revenue has grown at 8.7% a year over 3 years.

🟢 EBITDA has grown at 75.5% a year over 3 years.

🟢 EBITDA Margin has risen from 5.2% to 21.9% over 3 years (+16.7 pts).

🟢 PAT (Net Profit) has turned positive, from -₹203 Cr to ₹556 Cr.

🟢 EPS has turned positive, from ₹-22.49 to ₹60.34.

🟢 ROE has risen from -9.2% to 17.9% over 3 years (+27.1 pts).

🟢 ROCE has risen from -1.9% to 20.3% over 3 years (+22.2 pts).

🟢 Total Debt has shrunk at 16.6% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹51 Cr to ₹285 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹6,927 Cr

Total Liabilities

₹3,778 Cr

Total Debt

₹1,758 Cr

Cash & Equivalents

₹189 Cr

Operating Cash Flow

₹703 Cr

Capex

-₹418 Cr

Shareholding (proxy)

Institutional Holding

28.3%

Insider Holding

30.8%

Corporate Actions

Dividend Rate

₹5

Ex-Dividend Date

31 Jul 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,338.67

+28.2% vs CMP

Target Range

₹1,254 – ₹1,410

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 positive4 mixed1 general

Strides Pharma Q1 Profit Jumps 57% to ₹166 Cr

HDFC Sky, 31 JulResults

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

STAR 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.

Strides Pharma shares soar 10% as USFDA ends inspection at Bengaluru facility

Upstox, 19 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.

Strides Pharma Science Share Price Fall: Valuation View

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.

Strides Pharma surges 11% on USFDA EIR for flagship facility in Bengaluru

Business Standard, 20 Aug

Strides Pharma Science shares jump 9% after USFDA EIR for Bengaluru facility

The Economic Times, 20 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.

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

🟢Business QualityStrong16.7/20

🟢Financial HealthStrong15.6/20

🟢GrowthStrong13.6/20

🟢ProfitabilityStrong12/15

🟡ValuationFair7.3/15

🟡RiskModerate4.9/10

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.

This thesis breaks if

✓EBITDA margin holds above 20%21.9%
✓Revenue growth stays above 6% a year8.7% CAGR
✓Free cash flow remains positive₹285 Cr
✓Debt / EBITDA stays below 2x1.7x
✓ROCE stays above 17%20.3%