Gland Pharma (GLAND)

FairStock Score: 67/100 — STEADY

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

Key Financials

Strengths

• Strong balance sheet: debt/equity 0.03 and free cash flow of ₹2,633 Cr
• Healthy profitability signals: Piotroski F-score 8/9 and Altman Z-score 3.39
• Profit growth of 20.27% with latest quarterly net profit of ₹261 Cr
• Promoter holding of 51.83% aligns management with minority shareholders

Concerns

• Expensive valuation: P/E 34.74 and P/B 3.24 versus Graham Number of ₹801.85, implying negative margin of safety
• Modest returns on capital: ROE 9.26% and ROCE 11.89% are low for a growth premium
• Revenue growth is sluggish: sales growth 6.70% and 5-year revenue CAGR 10.15%, so profit growth may depend on margin expansion
• Stock is down sharply from its 52-week high of ₹3,039 to ₹1,798, which could signal a value trap

AI Analysis

Let's approach Gland Pharma the only way I know: what does the business earn, how sure am I, and at what price? The company earns ₹261 Cr in the latest quarter on ₹1,695 Cr sales, and profit growth is 20.27%. That is respectable. The balance sheet is pristine — debt/equity is 0.03, free cash flow is ₹2,633 Cr, and the Piotroski F-score of 8/9 points to a financially sound enterprise. The Altman Z-score of 3.39 also says no distress. Promoter holding of 51.83% aligns interests, and a focused injectables franchise gives it a durable niche. That is a kind of moat, though I cannot quantify it fully from these numbers. But quality is not the same as bargain. At ₹1,798, I am paying ₹30,022 Cr for the company: 34.74 times earnings and 3.24 times book value. Graham would shake his head; the Graham number is only ₹801.85, giving a margin of safety of -127.25%. The 52-week fall from ₹3,039 to ₹1,798 tells me the market is marking down the business, and I should not confuse a discounted price with a cheap one. Growth is mixed. Sales grew only 6.70%, and the five-year revenue CAGR is 10.15%. Profit grew 20.27%, but ROE is just 9.26% and ROCE 11.89%; for a 34 P/E, I expect more. The PEG of 0.43 seems seductive, and the DCF of ₹8,554.19 hints at hidden value, but when those numbers conflict with conservative book-value math, I trust the conservative side. A high-quality company at a high price is not an investment — it is a hope. I need a wider margin of safety before committing.

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