1. At a Glance
Laurus Labs is back with a bang: ₹1,570 Cr in revenue (up 31% YoY) and ₹389 Cr in EBITDA (up 127%). But don’t pop the champagne just yet — the stock still trades at a P/E of 89. That’s not a multiple, that’s a cry for help.
2. Introduction with Hook
Imagine a chemistry nerd hitting the gym, bulking up on steroids (pharma ones), and suddenly becoming a contract manufacturing bodybuilder. That’s Laurus Labs for you. From generic APIs to CDMO glory, this stock is doing a pharma backflip in mid-air.
Two stats to make your eyebrows do the worm:
- 127% YoY EBITDA growth in Q1 FY26
- ₹5,929 Cr TTM revenue (despite ARV segment shrinkage)
3. Business Model – WTF Do They Even Do?
Basically, Laurus makes boring yet essential chemicals that keep global pharma ticking — APIs for anti-retrovirals, oncology, and other alphabet-soup diseases. But here’s the twist: they’ve gone all-in on CDMO, aka the SaaS of the pharma world — recurring, scalable, and much fancier sounding.
Their business segments:
- Generic APIs (46% of revs) – falling, but stable
- CDMO/CMO – the new obsession
- Formulations – steady but not sexy
- Synthesis & Biotech – slow cookers with long-term upside
In short: Pharma meets startup meets manufacturing sweatshop.
4. Financials Overview – ₹ Cr
Metric | Q1 FY25 | Q1 FY26 | YoY Change |
---|---|---|---|
Revenue | 1,195 | 1,570 | +31% |
EBITDA | 171 | 389 | +127% |
Net Profit | 13 | 162 | +1,145% |
OPM | 14% | 24% | +1000 bps |
Margins tighter than an API plant’s gown protocol are now flexing like they’re on a muscle gain cycle.
5. Valuation – What’s This Worth?
Let’s play valuation gymnastics:
- P/E Method: ₹507 Cr TTM PAT × 25x = ₹12,675 Cr → FV = ₹235 per share
- EV/EBITDA Method: ₹1,266 Cr TTM EBITDA × 18x = ₹22,788 Cr EV → Net Debt ~₹2,000 Cr → Eq. Value = ₹20,788 Cr → FV = ₹386/share
Fair Value Range: ₹235–₹386
But wait, it trades at ₹838.
So unless you also order Vada Pav for ₹120 at Mumbai airport, you might want to breathe.
6. What’s Cooking – News, Triggers, Drama
- CDMO scale-up: Capacity ramp in biologics & synthesis
- EUR 5M JV investment with KRKA: Eastern Europe = cheap skilled labor + supply chain hedge
- New manufacturing facilities: Because who doesn’t like more CapEx in an industry built on inspection horror stories?
- Order book visibility: Strong for synthesis, weak for ARVs
- FPI/DII buying: Everyone’s in, even your dentist
More plot twists than an Ekta Kapoor biopic on molecules.
7. Balance Sheet – Not Titanic, But Not Titanic-Proof
Item | Mar 2025 (₹ Cr) |
---|---|
Equity | 108 |
Reserves | 4,365 |
Borrowings | 2,764 |
Total Liabilities | 9,336 |
Fixed Assets | 4,123 |
CWIP | 458 |
Other Assets | 4,521 |
Debt up, but manageable. Asset-heavy business. They love CapEx like pharma bros love patents.
8. Cash Flow – Sab Number Game Hai
Year | CFO | CFI | CFF | Net |
---|---|---|---|---|
FY23 | 994 | -997 | -27 | -30 |
FY24 | 666 | -822 | 250 | 93 |
FY25 | 602 | -680 | 39 | -39 |
Cash flow looks like your UPI balance after payday. Comes in, goes out, leaves behind hope and depreciation.
9. Ratios – Sexy or Stressy?
Ratio | FY25 |
---|---|
ROCE | 9% |
ROE | 7.45% |
P/E | 89.3x |
PAT Margin | 8.5% |
D/E | ~0.63 |
ROCE is flirting with mediocrity. P/E is dating delusion. Not sexy. Not stressy. Just… statistically confused.
10. P&L Breakdown – Show Me the Money
Year | Revenue | EBITDA | PAT |
---|---|---|---|
FY23 | 6,041 | 1,592 | 793 |
FY24 | 5,041 | 779 | 162 |
FY25 | 5,554 | 1,055 | 358 |
Q1 FY26 says “comeback” but FY24 was a pharmaceutical hangover.
11. Peer Comparison – Wedding of Midcaps
Company | Rev (TTM ₹ Cr) | PAT | P/E | ROCE |
---|---|---|---|---|
Sun Pharma | 52,578 | 11,454 | 36x | 20% |
Divi’s | 9,360 | 2,190 | 80x | 20% |
Laurus | 5,929 | 507 | 89x | 9% |
Zydus | 23,241 | 4,644 | 21x | 24% |
Looks like the guy wearing a tux at a Goa beach party — trying too hard with a P/E of 89 while peers chill at 20–30x.
12. Miscellaneous – Shareholding, Promoters, Drama
Category | Jun 2025 |
---|---|
Promoters | 27.60% |
FIIs | 25.70% |
DIIs | 11.94% |
Public | 34.78% |
Promoter holding is low-ish. FIIs and DIIs keep swiping right. Public shareholding dropping like attention spans.
Management: Dr. Satyanarayana Chava — founder, scientist, and CapEx connoisseur. A man who treats molecules like startup founders treat buzzwords.
13. EduInvesting Verdict™
Laurus is flexing its CDMO muscle, but the API biceps are cramping.
Q1 FY26 was strong — no doubt — but at 89x earnings, the stock is priced like it already cured cancer, solved climate change, and fixed airport Wi-Fi.
A solid molecule mix. But maybe don’t inhale the valuation fumes too deeply.
Written by EduInvesting Team | 25 July 2025
Tags: Laurus Labs, Pharma Stocks, CDMO, API, Earnings Analysis, EduInvesting Premium