Check Before You Invest : Cipla Ltd

Q: Which industry/sub-sector does Cipla Ltd belong to?

Cipla Ltd belongs to the Healthcare sector, operating specifically within the Pharmaceuticals & Drugs segment.

Q: Is Cipla Ltd a good quality company?

Cipla Ltd is a good quality company, based on a consistently good multi-year financial track record. This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q: Is Cipla Ltd undervalued or overvalued?

Cipla Ltd appears Fair, as its key valuation ratios are in line with their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 29.19, Historic Median: 29.14. Price to Book, Current: 3.29, Historic Median: 3.90. Price to Sales, Current: 4.09, Historic Median: 4.26. EV to EBITDA, Current: 16.48, Historic Median: 15.50

Q: Is Cipla Ltd a good buy now?

Cipla Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of Cipla Ltd?

Cipla Ltd revenue growth is 6.9% for FY-2025, which is below its 5-year CAGR of 9.97%, indicating slower growth.

Q: Gross Profit margin of Cipla Ltd?

Cipla Ltd Gross profit margin which is the profit after deduction of direct costs, is 21.4% for FY-2025, which is above its 5-year median of 17.4%, indicating increasing margins.

Q: Operating Profit Margin of Cipla Ltd?

Cipla Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.87% for FY-2025, which is above its 5-year median of 22.19% indicating increasing margins.

Q: Net Profit Margin of Cipla Ltd?

Cipla Ltd Net Profit Margin is 19.21% for FY-2025, is above its 5-year median of 12.53%, indicating increasing margins. Profitability Metrics. Gross Profit Margin (%), Current: 21.4, Historic Median: 17.4. Operating Profit Margin (%), Current: 25.87, Historic Median: 22.19. Net Profit Margin (%), Current: 19.21, Historic Median: 12.53

Q: Return on Asset of Cipla Ltd?

Cipla Ltd Return on Asset is 15.36%, which is above its 5-year historical median of 10.19%, indicating improved asset utilization efficiency.

Q: Return on capital employed (ROCE) of Cipla Ltd?

Cipla Ltd Return on capital employed is 23.64% for FY-2025, which is above its 5-year historical median of 18.19%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Check Before You Invest : Cipla Ltd

Snapshot

Q.1 Which industry/sub-sector does Cipla Ltd belong to?

Cipla Ltd belongs to the Healthcare sector, operating specifically within the Pharmaceuticals & Drugs segment.

Q.2 Is Cipla Ltd a good quality company?

Cipla Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Cipla Ltd undervalued or overvalued?

Cipla Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	29.19	29.14
Price to Book	3.29	3.90
Price to Sales	4.09	4.26
EV to EBITDA	16.48	15.50

Q.4 Is Cipla Ltd a good buy now?

Cipla Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.
How efficiently has it utilized Capital?
By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.
How is it managing its Debt?
By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Cipla Ltd?

Cipla Ltd revenue growth is 6.9% for FY-2025, which is below its 5-year CAGR of 9.97%, indicating slower growth.

Q.2 Gross Profit margin of Cipla Ltd?

Cipla Ltd Gross profit margin which is the profit after deduction of direct costs, is 21.4% for FY-2025, which is above its 5-year median of 17.4%, indicating increasing margins.

Q.3 Operating Profit Margin of Cipla Ltd?

Cipla Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.87% for FY-2025, which is above its 5-year median of 22.19% indicating increasing margins.

Q.4 Net Profit Margin of Cipla Ltd?

Cipla Ltd Net Profit Margin is 19.21% for FY-2025, is above its 5-year median of 12.53%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	21.4	17.4
Operating Profit Margin (%)	25.87	22.19
Net Profit Margin (%)	19.21	12.53

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Cipla Ltd?

Cipla Ltd Return on Asset is 15.36%, which is above its 5-year historical median of 10.19%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Cipla Ltd?

Cipla Ltd Return on capital employed is 23.64% for FY-2025, which is above its 5-year historical median of 18.19%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.7 Return on Equity (ROE) of Cipla Ltd?

Cipla Ltd Return on equity is 18.34% for FY-2025, which is above its 5-year historical median of 14.13%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Cipla Ltd?

Cipla Ltd Cash conversion cycle is 54 days, in line with its 5-year historical median of 52 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	1.08	1.15
ROE (%)	18.34	14.13
ROCE (%)	23.64	18.19
Cash Conversion Cycle	54 days	52 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Cipla Ltd?

Cipla Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.14, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Cipla Ltd?

Cipla Ltd Debt to cash flow from operations is 0.02, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Cipla Ltd?

Q.1 Promoter shareholding and pledge status of Cipla Ltd?

Promoters hold 29.21% of the Cipla Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Cipla Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Cipla Ltd vs industry peers?

Cipla Ltd revenue CAGR is 9.97%, compared to the industry median CAGR of 9.92%, indicating stable growth and maintaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	6.9	9.9
Gross Profit Growth (%)	14.1	16
Operating Profit Growth (%)	13.3	14
Net Profit Growth (%)	27.3	17.3

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	1.08	0.89
ROE (%)	18.34	15.74
ROCE (%)	23.64	19.26
Cash Conversion Cycle (days)	54.28	70

Valuation & price assessment

Q.1 Stock return of Cipla Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 10.7% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	10.7%	8.6%	14.9%	-4.5%

Q.2 Valuation ratios of Cipla Ltd vs historical?

The current P/E ratio of 29.19 is in line with than its historical median of 29.14, indicating that the stock is trading near its historical average valuation.

Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	29.19	29.14	31.09
Price to Book	3.29	3.90	2.85
Price to Sales	4.09	4.26	2.82
EV to EBITDA	16.48	15.50	15.99

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Check Before You Invest : Cipla Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

Check more companies

Check trending companies

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