1. 📊 At a Glance
Laurus Labs is a research-led pharma player with leadership in anti-retroviral APIs and a growing CDMO play. Once the toast of COVID, the stock saw a comedown as ARV demand waned and margins crashed. But FY25 results show signs of a turnaround. Is the lab cooking up a second act?
2. 🤯 Introduction with Hook
Laurus Labs is what happens when a solid business gets turbocharged by COVID demand… and then comes crashing down like a biotech hype stock.
From ₹200 to ₹700 to ₹370 and back to ₹746 – the stock has done more cardio than your gym coach.
But forget the stock for a sec. Let’s see what the business has really been up to.
3. ❓ Business Model (WTF Do They Even Do?)
- Core Segments:
- Generic APIs (46% of 9M FY25 rev): Antiretrovirals, oncology, HiPotent APIs
- CDMO/CMO: End-to-end development for global innovators
- Finished Dosage (FDFs): Especially for HIV generics
- Synthesis (Laurus Synthesis): Custom manufacturing
- Biotech (Laurus Bio): Acquired Richcore, now going deeper in enzymes, biologics
- Customers: Global pharma majors, biotech startups, institutions
- Geography: 80%+ export-driven
4. 📈 Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Sales (Cr) | 4,814 | 4,936 | 6,041 | 5,041 | 5,554 |
| Net Profit (Cr) | 984 | 832 | 793 | 162 | 358 |
| OPM % | 32% | 29% | 26% | 15% | 19% |
| ROE % | 40% | 26% | 23% | 7% | 7.45% |
🔹 Trend: Peak profitability was in FY21–FY22. Now climbing back slowly in FY25.
5. 💲 Valuation – Is It Cheap, Meh, or Crack?
- CMP: ₹746
- P/E: 126x
- Book Value: ₹82.9
- P/B: 9x
- Market Cap: ₹40,228 Cr
🚫 Fair Value Range:
- Normalised PAT ~₹400–500 Cr
- Fair P/E: 30–40x for mid-cap CDMO/API blend
- EduInvesting FV Range: ₹1200 Cr to ₹16,000 Cr → Per Share: ₹230 – ₹310
The stock is priced as if mRNA unicorns are queuing up outside. Not happening… yet.
6. 🌮 What’s Cooking – News, Triggers, Drama
- ₹39.9 Cr investment in Laurus Bio in June 2025
- Multiple investor meets lined up
- CDMO biz seeing strong inflows (esp. in Synthesis)
- COVID hangover finally ending; anti-retroviral demand stabilising
- FY25 PAT more than doubled YoY
7. 🏦 Balance Sheet – How Much Debt, How Many Dreams?
| Metric | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Total Debt (Cr) | 1,777 | 2,015 | 2,577 | 2,764 |
| Reserves (Cr) | 3,244 | 3,930 | 4,003 | 4,365 |
| D/E Ratio | ~0.6x now |
- Moderate leverage for capex
- No pledging
- Raising internal equity in Laurus Bio
8. 💵 Cash Flow – Sab Number Game Hai
| Year | CFO (Cr) | Capex (CFI) | FCF |
|---|---|---|---|
| FY23 | 994 | -997 | ~0 |
| FY24 | 666 | -822 | Negative |
| FY25 | 602 | -680 | Negative |
🙏 Capex-intensive phase. Laurus is reinvesting every rupee for capacity + CDMO scaling.
9. ⚖️ Ratios – Sexy or Stressy?
- ROCE: 9.15% – recovering
- ROE: 7.45% – weak
- Debt/Equity: 0.6x
- OPM: Back to 19% in Q4
- Dividend payout: 18% (decent)
Not sexy yet. But no longer stressy either.
10. 📉 P&L Breakdown – Show Me the Money
- FY25 Sales: ₹5,554 Cr
- EBITDA: ₹1,055 Cr
- PAT: ₹358 Cr
- EPS: ₹6.64
Q4 was the best quarter in 8 quarters. But sustainability is key.
11. 📈 Peer Comparison – Who Else in the Game?
| Company | ROE % | P/E | OPM % | Mcap (Cr) |
|---|---|---|---|---|
| Divi’s Labs | 15.3 | 83x | 31.7 | 1.8L Cr |
| Cipla | 17.7 | 24x | 25.9 | 1.2L Cr |
| Zydus Lifesci | 21.3 | 21x | 30.4 | 1L Cr |
| Laurus Labs | 7.45 | 126x | 19.0 | 40,228 Cr |
Way overvalued vs peers, esp. when you realise Divi’s has better OPM and cash.
12. 🚫 Miscellaneous – Shareholding, Promoters
- Promoter Holding: 27.62% (unchanged)
- FIIs: 25.5% – high confidence
- DIIs: 11.78%
- Public: 35%
- Shareholder base: 2.9 lakh
13. 🌟 EduInvesting Verdict™
Laurus went from COVID royalty to lab rat. But Q4FY25 finally shows green shoots – especially in CDMO and synthesis.
But the P/E is still in Narnia.
Unless margins jump back to 25%+ and profit scales up 2–3x, this valuation is like wearing a hazmat suit to a routine blood test.
🔹 FV Range: ₹230 – ₹310
🔹 Verdict: Laurus Labs: The comeback lab, but the hype’s overpriced
Tags: Laurus Labs, Laurus Bio, CDMO India, Pharma stocks, API manufacturer, Biotech India, EduInvesting 5-Year Recap, Antiretroviral, High P/E Pharma
✍️ Written by Prashant | 🗓️ July 1, 2025
