Fundamentally strong companies possess strong financials, such as a low debt-to-equity ratio, considerable profit growth, and consistent cash flow. Such companies are more likely to endure and emerge stronger from market downturns.
According to Grand View research, the global pharmaceutical manufacturing market size was estimated at USD 516.48 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 7.63 percent from 2023 to 2030.
Here are two Fundamentally strong Pharma stocks under Rs 100
Alembic Ltd
Alembic Ltd shares were trading at Rs 80.45 a share on Wednesday, up 0.20 percent from the previous close price of Rs 80.40.
The company’s revenue climbed by 68 percent year on year, rising from Rs 22 crore in Q1FY23 to Rs 37 crore in Q1FY24. During the same time period, net profit increased from Rs 19 crore to Rs 44 crore. The company has a debt-to-equity ratio of zero.
The company’s margin ratios have increased, with an operating margin of 31.6 percent and a net profit margin of 63.36 percent. Profitability ratios have improved, with a return on equity at 3.52 percent and a return on capital employed at 3.82 percent.
As per the shareholding pattern, The promoters of Alembic Ltd hold 70.88 percent of the company, while Retail Investors Possess 24.46 percent.
Alembic Limited is engaged in the businesses of Pharmaceuticals, Real Estate, and Power Assets.
Alpa Laboratories Ltd
Alpa Laboratories Ltd shares were trading at Rs 70.05 a share on Wednesday, up 1.16 percent from the previous close price of Rs 69.25.
The company’s revenue has increased by 13 percent year on year, from Rs 22.4 crore in Q1FY23 to Rs 22.5 crore in Q1FY24. During the same period, net profit climbed by 14 percent, from Rs 2.66 crore to Rs 3.03 crore. The company’s debt-to-equity ratio is 0.02.
The Alpa Laboratories margin ratios have grown, With an operating margin of 17.48 percent and a net profit margin of 13.66 percent, Profitability ratios have increased, with a 9.38 percent return on equity and an 11.80 percent return on capital employed.
As per the shareholding pattern, The promoters own 57.29 percent of the company, while retail investors possess 42.7 percent.
Alpa Laboratories is engaged in the business of manufacturing pharmaceutical products. The company manufactures a spectrum of products such as ethical drugs and generic drugs.
Written by Omkar Chitnis
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