Sai Life (SAILIFE)

FairStock Score: 38/100 — MIXED

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

Key Financials

Strengths

• Strong recent growth: sales up 39.61% and profit up 141.29%, with latest quarter net profit of ₹100 Cr
• Low leverage: debt/equity of 0.18 and Altman Z-Score of 6.03 indicate solid financial stability
• Piotroski F-Score of 8/9 signals good fundamental health across profitability, leverage, and efficiency
• ROE of 15.64% and ROCE of 14.05% suggest decent capital efficiency
• Five-year revenue CAGR of 17.40% shows a credible growth track record

Concerns

• Extreme valuation: P/E of 62.33, P/B of 10.37, and PEG of 3.33 leave no margin of safety; Graham Number of ₹104.40 versus price of ₹1,041.80 implies -856% margin of safety
• Free cash flow is negative at ₹-222 Cr, so earnings are not yet converting into cash
• No dividend yield and promoter holding of only 34.70% are less reassuring for minority investors
• Profit growth of 141.29% far exceeds the 5-year revenue CAGR, raising questions about sustainability

AI Analysis

Looking at Sai Life, I see a fast-growing pharmaceutical business that has delivered impressive momentum, but the price asks me to believe in perfection. Sales rose 39.61% and profit jumped 141.29%, with the latest quarter showing sales of ₹556 Cr and net profit of ₹100 Cr. Returns are respectable: ROE of 15.64%, ROCE of 14.05%, and debt/equity is low at 0.18. The Piotroski F-Score of 8/9 and Altman Z-Score of 6.03 suggest financial health is intact. So the business itself is not the problem. But as Graham said, price is what you pay, value is what you get. At ₹1,041.80, the market cap is ₹21,140 Cr, with a P/E of 62.33 and P/B of 10.37. Book value is only ₹100.50. Graham's number, a conservative estimate of value, is ₹104.40, meaning I have zero margin of safety; in fact, the margin of safety is negative 856%. Even adjusting for growth, the PEG ratio is 3.33, not cheap. Free cash flow is negative at ₹-222 Cr, so reported profits are not yet translating into cash for owners. There is no dividend, and promoter holding of 34.70% is a bit low for my comfort. Five-year revenue CAGR is 17.40%, which is good, but the latest 39.61% growth and 141.29% profit growth may not be sustainable. The FairStock Score of 48/100 reflects this mixed picture. Quality and momentum are there, but at this valuation, I would wait for a much better price or evidence that cash generation catches up with earnings. This is a fast grower, not a value investment at today's price.

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