Syngene International Limited

Healthcare — Diagnostics & Research · NSE

₹384.00−₹0.20 (−0.05%)

DalalBaazaar Score

45 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, small-cap size, which brings sharper price swings, 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, but sales are shrinking. Debt is 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 Syngene International Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Syngene International Limited, a contract research and manufacturing company, provides drug discovery and development services in India, the United States of America, Europe, and internationally.

IndustryDiagnostics & Research

SectorHealthcare

Employees6,692

Annual revenue₹3,611 Cr

How does it make money?

Turns over ₹3,611 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹28 left at the operating level before interest, tax and depreciation. Each of its 6,692 employees supports ₹54.0 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹54.0 lakh

Who are its competitors?

The closest listed comparisons in its industry are SUN PHARMACEUTICAL IND L, CIPLA LTD, DR. REDDY S LABORATORIES, APOLLO HOSPITALS ENTER. L. 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 8.3% 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 is the outlook?

7 analysts covering the stock expect revenue to grow about 15.8% and earnings to grow about 41.2% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+15.8%

Est. earnings growth+41.2%

Analysts7

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +17% while net margin moved -42% 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+17%

Margin effect-42%

DalalBaazaar Score

45/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 5.4% — barely ahead of inflation
✗ Profit has declined at 12.0% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Latest-year revenue growth of -15.8% is below the longer-term trend — momentum is fading
✗ Profit fell 36.2% in the latest year

Quality vs. Valuation

Company Quality

45/ 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

69.9x

3Y Median

56.3x

40 monthly readings · mean 54.6x · range 31.3x–74.1x

Sector Median

33.3x

median of 4 sector peers

⚠️Current valuation is approximately 24% above its 3y median of 56.3x. 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 110% above the peer median of 33.3x.

vs. its own history

Expensive

56.3x median over 40 months · +24%

vs. sector peers

Expensive

33.3x median of 4 peers · +110%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

15.6x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 44% over 3 years.
Cash generation is improving
Free cash flow is up 79% 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 12.8% to 6.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 13.5% to 8.3% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 1 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 9.47x — earnings must service borrowings before shareholders see anything.
🟡Profit is decliningFinancial
Net profit is down 32% over 3 years.
🟡Margins are compressingFinancial
EBITDA margin is down 4.3 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 44% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
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?

Margins are being competed away
EBITDA margin has fallen from 32.2% to 27.9%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 9.47x. Interest is payable whether or not the business has a good year.
The price already assumes success
The stock trades 24% 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.
Growth barely outpaces inflation
Revenue compounding at 5.4% 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.
Returns on shareholder capital are falling
ROE has dropped from 12.8% to 6.5%. 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.

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

1EBITDA margin holds above 26%✓ 27.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✓ 5.4% CAGR
Latest reported year was -15.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹547 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✓ 8.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

4 / 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

2 good · 4 neutral · 5 weak

Market Cap

₹15,433 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

69.9x

Expensive

Expensive — verify against sector peers

P/B Ratio

3.19x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.49

Profitable

Profitable on a per-share basis

ROE

6.5%

Weak

Weak capital efficiency

ROCE

8.3%

Moderate

Moderate return on the capital in the business

Debt/Equity

9.47x

High

High leverage

Revenue Growth (YoY)

-15.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

-36.2%

Falling

Profits are shrinking

Dividend Yield

0.33%

Modest

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

Free Cash Flow

₹547 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

35.8x

Improving

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

Operating Margin

3.9%

Weak

Thin margins leave little room for error

Net Margin

6.1%

Average

Average bottom-line conversion

Current Ratio

1.38

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.07

Defensive

Steadier than the market

52W Range Position

12%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

371.4 / 387.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

53.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3,080 Cr	₹3,370 Cr	₹3,513 Cr	₹3,611 Cr	+5.4%
EBITDA	₹993 Cr	₹1,092 Cr	₹1,096 Cr	₹1,007 Cr	+0.5%
EBITDA Margin	32.2%	32.4%	31.2%	27.9%	—
PAT (Net Profit)	₹464 Cr	₹510 Cr	₹496 Cr	₹317 Cr	-12.0%
EPS	₹11.51	₹12.69	₹12.34	₹7.87	-11.9%
ROE	12.8%	12.0%	10.5%	6.5%	—
ROCE	13.5%	13.3%	13.1%	8.3%	—
Total Debt	₹815 Cr	₹555 Cr	₹578 Cr	₹458 Cr	-17.5%
Free Cash Flow	₹305 Cr	₹531 Cr	₹398 Cr	₹547 Cr	+21.5%

🟢 Revenue has grown at 5.4% a year over 3 years.

🟡 EBITDA has been broadly flat over 3 years (0.5% a year).

🔴 EBITDA Margin has fallen from 32.2% to 27.9% over 3 years (-4.3 pts).

🔴 PAT (Net Profit) has shrunk at 12.0% a year over 3 years.

🔴 EPS has shrunk at 11.9% a year over 3 years.

🔴 ROE has fallen from 12.8% to 6.5% over 3 years (-6.3 pts).

🔴 ROCE has fallen from 13.5% to 8.3% over 3 years (-5.2 pts).

🟢 Total Debt has shrunk at 17.5% a year over 3 years.

🟢 Free Cash Flow has grown at 21.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹7,055 Cr

Total Liabilities

₹2,216 Cr

Cash & Equivalents

₹229 Cr

Operating Cash Flow

₹915 Cr

Capex

-₹368 Cr

Shareholding (proxy)

Institutional Holding

38.7%

Insider Holding

52.8%

Corporate Actions

Next Earnings

11 Nov 2026

Dividend Rate

₹1.25

Ex-Dividend Date

25 Jun 2026

Analyst Consensus

Recommendations

5 Buy · 2 Hold · 1 Sell

Target Price (Mean)

₹501.88

+30.7% vs CMP

Target Range

₹340 – ₹735

Peer Comparison

Company	P/E	ROE
SUN PHARMACEUTICAL IND L	34.9x	14.5%
CIPLA LTD	31.8x	9.8%
DR. REDDY S LABORATORIES	31.0x	8.8%
APOLLO HOSPITALS ENTER. L	54.3x	22.0%

Recent News

3 mixed3 general

Syngene International (NSEI:SYNGENE) - Stock Analysis

Simply Wall Street, 14 Oct

SYNGENE Outlook for the Week

Equitypandit, 09 Oct

Volumes spurt at Syngene International Ltd counter

Business Standard, 20 Aug

SYNGENE 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.

Why Is Syngene International Share Price Falling Key Reasons 2026

Univest, 05 MayPrice 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.

Syngene shares can still rally 70% despite Macquarie cutting price target; here's why

CNBC TV18, 24 JunPrice 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

Revenue growth is negative (-15.8%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health

MiddlingRisk

WeakBusiness Quality · Growth · 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.

All 5 tripwires holding · see Key things to watch ↑