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Lupin Ltd.

Large Cap

Evaluated by 3465 users |

BSE

: 500257 |

NSE

: LUPIN |

Pharmaceuticals & Drugs

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Consolidated basis
The valuation guidance of this company is based on Consolidated basis.
1. Right Stock
This company is among the most fundamentally sound companies on account of its consistent performance on both the colour-coding parameters - Value Creation & Business Growth.
2. Right Price
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Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
10 Year X-Ray
MoneyWorks4me Colour Coding
Value Creation To be investment worthy, a company has to create a shareholder value in excess of its cost of capital employed. VCI (Value Creation Index) shows how efficient has the company been in doing this.
Value Creation Index: Colour Rating Guide
  • >0.25 : Very Good
  • 0 to 0.25 : Somewhat Good
  • <0: Not Good
 Mar'04Mar'05Mar'06Mar'07Mar'08Mar'09Mar'10Mar'11Mar'12Mar'13
Return on Capital Employed
The return on capital employed gives a sense of how well a company is using its money to generate returns.
16.2%12.35%16.18%14.94%21.45%21.62%22.48%21.46%18%22.41%
Value Creation Index
The difference between ROCE and WACC as a Proportion of WACC reveals the extent of value created by a company.
Ie. (ROCE-WACC)/WACC
ROCE is Return on Capital Employed
WACC is Weighted Average Cost of Capital
0.620.010.250.070.821.381.511.080.63NA
Growth Parameters Growth Parameters help gauge a company's growth in the past 10 years. A value creating company needs to grow at a sustainable pace to continue creating value.
For Net Sales and EPS Growth Rate
  • >12% : Very Good
  • 8% to 12% : Somewhat Good
  • <8% : Not Good
For Debt To CFO
  • 0 to <1.5 : Very Good
  • 1.5 to <3 : Somewhat Good
  • >3 or <0: Not Good
Net Sales (Rs. Cr.)
Net Sales is calculated by deducting excise duty, sales tax and other such deductible indirect taxes from the gross sales of a company.
1,2151,2611,6952,0142,8923,8674,8715,8197,0839,641
Y-o-Y Gr. Rt.-3.8%34.4%18.8%43.6%33.7%26%19.5%21.7%36.1%
Adjusted EPS (Rs.)
Adjusted Earning per Share is the company’s net profit per share after adjusting for extra-ordinary/exceptional items
2.862.244.495.4610.4212.6115.5619.2520.0429.79
Y-o-Y Gr. Rt.--21.7%100.5%21.6%90.8%21%23.4%23.7%4.1%48.7%
Book Value per Share (Rs.)
The total value that a company will fetch upon liquidation (if it is closed down), after settling all obligations is called its Book Value. Book value of a company includes only tangible assets. Book value allocated to each outstanding share is called Book Value per share
10.7112.1715.521.7231.1834.4157.7373.5189.78116.13
Adjusted Net Profit Adjusted Net Profit is a measure of company's profitability after accounting for all costs and adjusting for one time events. 11589.81802204275226928598951,333
Net Op. Cash Flow (Rs. Cr.)
This refers to the amount of cash a company generates from the revenues less operating expenses.
3911211321782594706767985601,251
Debt to Cash Flow from Ops
Debt to CFO (Cash Flow from Operations) conveys the number of years it will take for a company to repay its debt, given the cash generated from operations.
CFO: It is the amount of cash generated by the company through its core business operations without looking at the impact of its capital structure. It indicates whether the company is able to generate sufficient cash from its operations to maintain and run its operations.
1.013.777.034.864.652.611.691.462.930.93
CAGR
The Growth rate helps you understand how the company has performed over different time frames.
CAGR Colour Code Guide
CAGR Colour Code Guide
  • >12% : Very Good
  • 8% to 12% : Somewhat Good
  • <8% : Not Good
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales
Net Sales is calculated by deducting excise duty, sales tax and other such deductible indirect taxes from the gross sales of a company.
25.9%27.2%25.6%36.1%
Adjusted EPS
Adjusted Earning per Share is the Company’s net profit per share after adjusting for extra-ordinary/exceptional items.
29.7%23.4%24.2%48.7%
Book Value per Share
The total value that a company will fetch upon liquidation (if it is closed down), after settling all obligations is called its Book Value. Book value of a company includes only tangible assets. Book value allocated to each outstanding share is called Book Value per share
30.330.126.229.4
Key Financial Parameter The key financial ratios show the growth and sustainability of the Value Creation Index.
Performance Ratios: Colour Rating Guide
  • >12% : Very Good
  • 8% to 12% : Somewhat Good
  • <8% : Not Good
Debt to Equity Colour Rating Guide
  • 0 to 1 : Very Good
  • >1 to 2 : Somewhat Good
  • >2 or <0: Not Good
Return on Equity (%)
Return on Equity shows the amount of net profit generated as a percentage of shareholders equity. 
ROE measures a company's profitability over the money shareholders have invested. 
28.4119.5132.3929.3439.7138.6234.6529.3724.5428.93
Operating Profit Margin (%)
Operating Profit Margin shows how much profit a company makes (before interest payment and taxes) on sales. It is advisable to look at the change in a company’s operating margin over time and compare the company's yearly or quarterly numbers to those of its competitors.
18.3210.6314.0415.0522.5719.8820.6920.4120.9623.95
Net Profit Margin (%)
NPM (Net Profit Margin) is the ratio of profit, net of taxes and interests to sales. It is advisable to look at changes in a company’s NPM over time and to compare them with the competitor’s NPM.
9.577.1510.6510.9114.7913.6714.5715.0512.9214.1
Debt to Equity
This ratio indicates the ratio of equity to debt the company employs to finance its operating assets.
0.920.941.490.990.940.860.440.350.410.22
Working Capital Days
This is the number of days that a company will take to convert its working capital into revenue.
223188161170176183176186198177
Cash Conversion Cycle
Cash Conversion Cycle is a company's net working capital (creditors, debtors and inventory) expressed in terms of days
86897371849684808980
What do we look at?
Management Assessment: An assessment of the trustworthiness of the management based
on 5 important parameters. These parameters are colour coded as Green (Very Good),
Orange (Somewhat Good) and Red (Not Good)
Percentage Holding
46.75%
43.17%
10.08%

Pledged *22.4021.5310.676.252.380.000.000.000.000.000.000.000.000.000.000.000.000.000.000.00
*  Pledged shares as % of Promoter's holding (%)

The 10 YEAR X-RAY analysis of Lupin Ltd. has been done on a consolidated basis considering the significant contribution of its subsidiaries.

The 10 YEAR X-RAY of Lupin Ltd. shows that the performance of the company has been very good over ... Read more

The 10 YEAR X-RAY analysis of Lupin Ltd. has been done on a consolidated basis considering the significant contribution of its subsidiaries.

The 10 YEAR X-RAY of Lupin Ltd. shows that the performance of the company has been very good over the last 10 years. It is one of the few companies which have shown consistently positive value creation over the last 10 years; value creation has especially improved over the last 5 years. ROE and ROIC figures have been very good with 6 year average figures of ~33% and ~20% respectively. Since 2008, Lupin’s product mix has shifted more towards exports and formulations which seem to have helped it clock better margins. As a result, value creation as seen by the spread between Return on Invested Capital and Weighted average cost of capital i.e. (ROIC – WACC) has been more than 40% of WACC for the last 5 years.

On the growth front as well, Lupin’s net sales have registered robust and consistent growth since FY 2006 growing at more than our benchmark rate of 12%. Over the years, the company has focused more on formulations and regulated markets of US and EU. This focus, along with its vertically integrated operations, has enabled it to grow its sales at this pace.

Change in the business mix has also led to good growth in profitability as witnessed by the growth seen in the EPS. EPS has grown more than 20% for the last 6 years. The company has steadily increased its operating and net profit margins which have increased from 14% and 10% in FY 2006 to 21% and 12.5% in FY 2012, respectively.

This has led to a good growth in operating cash flows and also enabled the company to reinvest in the business leading to a growth of 28% (9 year CAGR) in Book value per share. Lupin’s Debt to Net Profit ratio has improved over the years with the high growth seen in profits and as of FY 2012 stood at a comfortable 1.83. Lupin’s working capital and net working capital days are slightly on the higher side as compared to some of the other pharma players however cash conversion cycle has been consistent.

Thus, considering all these factors, we can say that the 10 YEAR X-RAY of Lupin Ltd. is Green (Very Good).

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