At a Glance
Themis Medicare just delivered a Q1 FY26 shocker – revenue rose to ₹98 Cr (+1% YoY), but net loss widened to ₹14 Cr, thanks to higher expenses and evaporating margins (-10% OPM). Once a small-cap pharma name with a decent anti-TB and anti-malarial portfolio, it’s now struggling to stay profitable. Stock has tanked near 52-week lows (₹105 vs ₹317 high). And yes, management added new directors, withdrew a merger, and still somehow declared a dividend. Classic pharma plot twist.
Introduction
What do you get when a pharma company with decent products, weak margins, and rising costs walks into a quarter? A financial headache. Themis Medicare, despite its 50+ year legacy, is now running with negative OPM, ballooning debtor days (159), and a balance sheet that feels like it’s on antibiotics itself.
Investors? They’re either very brave or very stuck. This Q1 FY26 makes one thing clear: turnaround isn’t a drug you can buy OTC.
Business Model (WTF Do They Even Do?)
- APIs & Formulations: Anti-TB, anti-malarial, anti-cholesterol, pain management.
- Antiseptics & Generics: Mostly institutional and tender-driven sales.
- Export Focus: Some international exposure but thin margins.
The company relies heavily on institutional contracts, which means low pricing power. Mix in rising raw material costs and delayed receivables, and you have a recipe for earnings volatility.
Financials Overview
Q1 FY26 Snapshot:
- Revenue: ₹98 Cr
- Operating Loss: ₹10 Cr
- OPM: -10%
- Net Loss: ₹14 Cr
- EPS: -₹1.54
FY25 Recap:
- Revenue: ₹406 Cr
- PAT: ₹30 Cr
- EPS: ₹3.24
- Margins eroded throughout the year.
Commentary: The company’s margins collapsed, and losses are now becoming the new normal.
Valuation
1. P/E Method
- EPS (FY25): ₹3.24
- CMP ₹105 → P/E: ~32x (on FY25, but Q1 loss makes P/E meaningless)
2. EV/EBITDA
- FY25 EBITDA ≈ ₹49 Cr
- EV ≈ Market Cap ₹969 Cr + Debt ₹83 Cr → ₹1,052 Cr
- EV/EBITDA ≈ 21x (very high for a loss-making small-cap)
3. DCF (Quick & Dirty)
- Assume flat growth, high risk → Fair Value: ₹80 – ₹110
Verdict: Valuation stretched, considering operational struggles.
What’s Cooking – News, Triggers, Drama
- Merger Withdrawn: Planned merger scrapped – no synergy boost.
- New Appointments: Independent director and sales head added.
- Dividend Declared: Despite losses, final dividend record date fixed (investor appeasement?).
- Debt Concerns: High debtor days suggest cash crunch.
- Turnaround Unclear: No clear guidance yet.
Balance Sheet – Not Healthy
| Assets | ₹ Cr |
|---|---|
| Total Assets | 588 |
| Fixed Assets | 172 |
| Investments | 95 |
| Other Assets | 318 |
| Liabilities | ₹ Cr |
|---|---|
| Borrowings | 83 |
| Other Liabilities | 102 |
| Net Worth | 402 |
Remark: Debt moderate, but working capital stress visible.
Cash Flow – Sab Number Game Hai
| Year | Ops (₹ Cr) | Investing (₹ Cr) | Financing (₹ Cr) |
|---|---|---|---|
| FY23 | 16 | -24 | 0 |
| FY24 | 22 | -16 | -9 |
| FY25 | 35 | -12 | -26 |
Remark: Operating cash improving, but financing cash outflows hurting.
Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 7.65% |
| ROCE | 10.4% |
| P/E | NA (loss) |
| PAT Margin | -10% |
| D/E | 0.21x |
Remark: Ratios scream distress.
P&L Breakdown – Show Me the Money
| Year | Revenue ₹ Cr | EBITDA ₹ Cr | PAT ₹ Cr |
|---|---|---|---|
| FY23 | 354 | 67 | 57 |
| FY24 | 382 | 52 | 44 |
| FY25 | 406 | 49 | 30 |
| TTM | 380 | 5 | -9 |
Remark: Earnings collapsing faster than margins.
Peer Comparison
| Company | Rev (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Sun Pharma | 53,777 | 11,463 | 34x |
| Cipla | 27,811 | 5,379 | 23x |
| Zydus | 23,242 | 4,644 | 21x |
| Themis Medicare | 380 | -9 | NA |
Remark: Peers are growing; Themis is shrinking.
Miscellaneous – Shareholding, Promoters
- Promoters: 67.15% (stable)
- FIIs: negligible
- Public: 32.75%
- No institutional rescue likely in sight.
EduInvesting Verdict™
Themis Medicare is on life support. The business is losing money, margins are negative, and debtor days are high. Management shake-ups and merger withdrawal add to uncertainty. While the stock trades near lows, there’s no visible catalyst for revival – unless a new product pipeline suddenly delivers.
SWOT
- Strengths: Established brand, niche anti-TB portfolio.
- Weaknesses: Negative margins, high receivables, poor cash cycle.
- Opportunities: Turnaround via cost control, exports growth.
- Threats: Competition, regulatory issues, liquidity crunch.
Final Word:
A classic falling knife. Only worth watching if you like deep-value turnarounds (and have nerves of steel).
Written by EduInvesting Team | 01 Aug 2025
SEO Tags
Themis Medicare, Pharma Smallcap, Q1 FY26 Loss, Turnaround Watch, Falling Knife
