Divi's Lab. (DIVISLAB)

FairStock Score: 54/100 — MIXED

Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 1/2 · Dividend: 0/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a Buffett/Graham investor, I look for a durable business at a sensible price. Divi's Lab scores well on quality: ROE 16.56%, ROCE 20.44%, debt/equity 0.00, Piotroski F-Score 8/9, and Altman Z-Score 8.17. That debt-free balance sheet and high returns suggest some moat in pharmaceuticals, though the numbers alone don't prove pricing power. Growth is impressive: latest quarter sales ₹2,604 Cr, net profit ₹583 Cr; sales growth 27.80% and profit growth 65.70%. Five-year revenue CAGR is 11.65%, so the recent burst is stronger. Free cash flow ₹849 Cr is positive, and promoter holding 51.88% aligns interests. But valuation is the rub. At ₹8,477, market cap ₹2.25 lakh Cr, P/E 87.72, P/B 13.43, dividend yield 0.35%, and PEG 4.35. Graham Number is ₹1,088.39, leaving a margin of safety of -488.81%; DCF intrinsic value ₹524.98. EV/EBITDA is -52.30, which is anomalous. The FairStock Score of 54/100 confirms a mixed picture. The company is a fast grower, but I'm not paying 87x earnings for 16.56% ROE and 11.65% five-year revenue CAGR. Buffett says price is what you pay, value is what you get. Divi's is a wonderful business by balance sheet and returns, but at this price the stock offers little margin of safety. I'd watch sales/profit sustainability, ROCE, FCF, and whether valuation compresses. For now, wonderful company, speculative price.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer