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Check Before You Invest : Adeshwar Meditex Ltd

BSE: 543309 NSE: ISIN: INE0H8J01015
  |   Sector:  Healthcare   |   Industry:  Pharmaceuticals & Drugs

Snapshot

Q.1 Which industry/sub-sector does Adeshwar Meditex Ltd belong to?
Adeshwar Meditex Ltd belongs to the Healthcare sector, operating specifically within the Pharmaceuticals & Drugs segment.
Q.2 Is Adeshwar Meditex Ltd a good quality company?
Adeshwar Meditex Ltd is a quality company, based on a 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 Adeshwar Meditex Ltd undervalued or overvalued?
Adeshwar Meditex Ltd appears Undervalued, as its key valuation ratios are lower than 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 11.48 19.28
Price to Book 0.64 1.14
Price to Sales 0.28 0.47
EV to EBITDA 7.12 10.07
Q.4 Is Adeshwar Meditex Ltd a good buy now?
Adeshwar Meditex Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. 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 Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd revenue growth is 4.8% for FY-2025, which is below its 5-year CAGR of 8.33%, indicating slower growth.

Q.2 Gross Profit margin of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Gross profit margin which is the profit after deduction of direct costs, is 3.9% for FY-2025, which is in line with its 5-year median of 4.1%, indicating stable margins.

Q.3 Operating Profit Margin of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 5.29% for FY-2025, which is below its 5-year median of 6.34% indicating decreasing margins.

Q.4 Net Profit Margin of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Net Profit Margin is 2.47% for FY-2025, is in line with its 5-year median of 2.51%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 3.9 4.1
Operating Profit Margin (%) 5.29 6.34
Net Profit Margin (%) 2.47 2.51

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Return on Asset is 3.04%, which is in line with its 5-year historical median of 2.98%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Return on capital employed is 8.53% for FY-2025, which is below its 5-year historical median of 9.6%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Return on equity is 5.75% for FY-2025, which is in line with its 5-year historical median of 5.92%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Cash conversion cycle is 162 days, in line with its 5-year historical median of 163 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) 1.23 1.18
ROE (%) 5.75 5.92
ROCE (%) 8.53 9.6
Cash Conversion Cycle 162 days 163 days

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

Q.9 Debt to Equity ratio of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Debt-to-Equity ratio is 0.34, which is above the industry average of 0.14, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Adeshwar Meditex Ltd?
Adeshwar Meditex Ltd Debt to cash flow from operations is 3.28, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Adeshwar Meditex Ltd?

Q.1 Promoter shareholding and pledge status of Adeshwar Meditex Ltd?
Promoters hold 57.68% of the Adeshwar Meditex Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Adeshwar Meditex Ltd vs industry peers?
Adeshwar Meditex Ltd revenue CAGR is 8.33%, compared to the industry median CAGR of 5.52%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 4.8 5.5
Gross Profit Growth (%) -3 13.9
Operating Profit Growth (%) -14.5 11.6
Net Profit Growth (%) 3 12.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.23 0.79
ROE (%) 5.75 9.17
ROCE (%) 8.53 11.52
Cash Conversion Cycle (days) 161.89 76

Valuation & price assessment

Q.1 Stock return of Adeshwar Meditex Ltd over the last decade?
Over the last 3 year(s), the stock has delivered a CAGR of -13.03% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - -13% 9.5%
Q.2 Valuation ratios of Adeshwar Meditex Ltd vs historical?
The current P/E ratio of 11.48 is lower than its historical median of 19.28, indicating that the stock is trading below 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 11.48 19.28 31.09
Price to Book 0.64 1.14 2.85
Price to Sales 0.28 0.47 2.82
EV to EBITDA 7.12 10.07 15.99

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