Zydus Lifesci. (ZYDUSLIFE)

FairStock Score: 71/100 — STEADY

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

Key Financials

AI Analysis

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

I approach Zydus Lifesci. as a Graham-style bargain hunter and Buffett-style business owner. The numbers show a steady pharmaceuticals business, not a bargain. Price is ₹1135.20 against book value ₹269.43 and Graham Number ₹511.25. That means I would be paying about 80% above Graham’s asset-and-earnings yardstick; margin of safety is -80.28%, not acceptable. P/E 25.32 and P/B 4.21 already reflect much optimism. The quality side is better: ROE 20.62%, ROCE 24.31%, debt/equity 0.42, Piotroski 8/9, and Altman Z 3.59. Those are signs of financial strength and some competitive advantage—pharma scale, high returns—though the moat is not proven by the top line: sales growth only 4.62% and 5-year revenue CAGR 10.27%, while profit growth is -11.72%. Latest quarter sales ₹6,865 Cr and net profit ₹1,023 Cr show the business still earns, but free cash flow is -₹1,600 Cr, a yellow flag. Dividend yield 0.09% offers almost nothing for income. Promoter holding 75% keeps interests aligned, but also limits float. At EV/EBITDA 12.89 and PEG 1.78, the market is not paying for a no-growth laggard; it expects recovery. If profits revive, a Stalwart-like pharma compounder may reward patient owners. But Graham would ask: where is my discount? I see quality at a fair-to-full price. I would wait for either profit growth to turn positive, FCF to recover, or price closer to intrinsic value before buying.

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