1. At a Glance
RPG Life Sciences is part of the RPG Group and operates in formulations and active pharma ingredients (APIs). With a debt-free balance sheet, expanding margins, and a tasty ₹24 dividend, this pharma midcap has gone from boring to blazing—up 4.7x in 5 years.
2. Introduction with Hook
Imagine if Parle-G biscuits suddenly turned into Ferrero Rocher—same brand, new avatar. That’s RPG Life Sciences. Once a sleepy division of RPG Group, now a fire-breathing margin monster in the pharma space.
- Stock CAGR: 53% in 5 years, 63% in 3 years
- ROCE: 33% in FY25
- FY25 Net Profit: ₹183 Cr (up 108% YoY thanks to a cheeky ₹83 Cr land sale gain)
But… was the growth organic or just a lucky land flip? Let’s find out.
3. Business Model (WTF Do They Even Do?)
RPG Life Sciences has three verticals:
- Domestic Formulations (Branded) – Prescription meds in nephrology, immunology, gastro, and cardiac
- International Formulations (Generics) – Exports to regulated markets (EU, UK, Australia)
- APIs (Active Pharma Ingredients) – Backward integrated into their own formulations; margin booster.
They’re present in 21 countries, 90% products are vertically integrated, and they’ve slowly migrated from plain-vanilla generics to premium branded therapies.
4. Financials Overview
| FY | Revenue (₹ Cr) | EBITDA (₹ Cr) | Net Profit (₹ Cr) | OPM % | EPS (₹) |
|---|---|---|---|---|---|
| FY21 | 389 | 71 | 40 | 18% | 24.2 |
| FY22 | 440 | 87 | 51 | 20% | 31.1 |
| FY23 | 513 | 104 | 68 | 20% | 40.9 |
| FY24 | 582 | 129 | 88 | 22% | 53.0 |
| FY25 | 653 | 161 | 183* | 25% | 110.8 |
*Includes ₹83 Cr land gain
Highlights:
- 5Y PAT CAGR: 29%
- 5Y Sales CAGR: 12%
- OPM expanding every year, from 10% (FY19) to 25% (FY25)
5. Valuation
Let’s get serious. No multibagger fantasy here—just maths.
P/E Valuation (adjusted for land sale):
- Adjusted EPS (FY25): ₹60
- P/E range: 25x to 30x → Fair Value Range: ₹1,500–₹1,800
EV/EBITDA Method:
- FY25 EBITDA: ₹161 Cr
- EV/EBITDA range: 15x to 18x → FV Range: ₹2,415–₹2,898
DCF Whisper Estimate: ₹2,400–₹2,700 (assuming 18% RoIC, 10% growth, 11% WACC)
EduInvesting Fair Value Range: ₹2,100 – ₹2,800
(Yes, the current price ₹2,508 is smack in the middle)
6. What’s Cooking – News, Triggers, Drama
- Dividend of ₹24/share declared (₹20 final + ₹4 special)
- New MD appointed: Ashok Nair (ex-Natco, seasoned operator)
- Fire Incident in Jan 2025 (Loss insured, ₹16.3 Cr)
- Land Sale Windfall: ₹83 Cr gain booked in FY25
- Sunpound Solar Investment: 26% stake acquired. ESG alignment?
Trigger Watchlist:
- USFDA site approval (high margin)
- Launch of high-value generics in UK/EU
- Expansion of branded India business
7. Balance Sheet
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | ₹13 Cr | ₹13 Cr | ₹13 Cr |
| Reserves | ₹294 Cr | ₹362 Cr | ₹517 Cr |
| Borrowings | ₹0 Cr | ₹0 Cr | ₹0 Cr |
| Total Assets | ₹419 Cr | ₹513 Cr | ₹658 Cr |
| Cash & Inv. | ₹58 Cr | ₹91 Cr | ₹127 Cr |
Key Points:
- Zero debt. Nada. Zilch.
- Reserves more than tripled in 3 years.
- Strong asset-light growth—only ₹16 Cr CWIP in FY25.
8. Cash Flow – Sab Number Game Hai
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| CFO | ₹91 | ₹94 | ₹78 |
| CFI | -₹106 | -₹79 | -₹42 |
| CFF | -₹17 | -₹20 | -₹27 |
| Net Cash Flow | -₹32 | -₹5 | ₹9 |
Insights:
- Investing in capacity, not bleeding cash
- Cash from ops stable, no working capital crisis
- Positive net cash again in FY25 (yay?)
9. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE | 33% | 35% | 33% |
| ROE | 26% | 25% | 25.5% |
| Debtor Days | 27 | 31 | 48 |
| Inventory Days | 203 | 200 | 159 |
| Cash Conversion Cycle | 91 | 90 | 72 |
Highlights:
- ROCE of 33% is Michelin-star worthy
- Slight uptick in debtor days—keep an eye
- Inventory cycle improving. Stress down. Smooth sailing.
10. P&L Breakdown – Show Me the Money
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | ₹513 | ₹582 | ₹653 |
| EBITDA | ₹104 | ₹129 | ₹161 |
| EBITDA Margin | 20% | 22% | 25% |
| PAT | ₹68 | ₹88 | ₹183* |
*Includes land sale of ₹83 Cr
Net-net: Profitability improving, and margin expansion looks sticky—not fluke.
11. Peer Comparison
| Company | CMP (₹) | P/E | ROCE (%) | OPM (%) | Mkt Cap (Cr) |
|---|---|---|---|---|---|
| Sun Pharma | 1,693 | 35.5 | 20.2 | 28.8 | ₹4.06L Cr |
| Divi’s Lab | 6,731 | 81.7 | 20.4 | 31.8 | ₹1.78L Cr |
| Torrent Pharma | 3,521 | 62.2 | 27.1 | 32.3 | ₹1.19L Cr |
| Zydus Lifesciences | 975 | 21.0 | 24.4 | 30.4 | ₹98.1K Cr |
| RPG Life Sciences | 2,508 | 35.9 | 32.8 | 24.6 | ₹4,149 Cr |
Conclusion:
RPG Life punches above its ₹4K Cr weight class in margins and ROCE. But can it scale like Zydus or Torrent?
12. Miscellaneous – Shareholding, Promoters
| Holder Type | Mar 2025 |
|---|---|
| Promoters | 72.95% |
| FIIs | 1.46% |
| DIIs | 6.14% |
| Public | 19.46% |
- Promoters have consistently held >72%—strong control
- DII holding up from 0.3% in Jun 2022 to 6.1% now
- Public share is shrinking as institutions gobble up
Also: 22K+ retail shareholders, indicating rising retail traction.
13. EduInvesting Verdict™
RPG Life is the pharma equivalent of a Maruti Swift with a Tesla engine—small cap, high torque. Exceptional FY25 profits were partly steroid-pumped by a land deal, but even adjusted for that, the core engine is firing on all cylinders.
- Zero debt
- 25%+ ROCE
- Expanding branded business
- Tight control from RPG Group
- Emerging as a dark horse in midcap pharma
But valuation isn’t a joke. At 35x earnings and 7.8x book, you’re paying for quality and then some. If it delivers on growth + exports + new launches, re-rating can continue. If not, land-flip glory will fade faster than a sugar rush.
Metadata
– Written by EduInvesting Research | 18 July 2025
– Tags: RPG Life Sciences, Pharma, Midcap, High ROCE, Land Sale, Ashok Nair, Dividend Stock, Debt-Free Stocks, Growth Stocks
