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Check Before You Invest : Mangalam Drugs And Organics Ltd

BSE: 532637 NSE: MANGALAM ISIN: INE584F01014
  |   Sector:  Healthcare   |   Industry:  Pharmaceuticals & Drugs

Snapshot

Q.1 Which industry/sub-sector does Mangalam Drugs And Organics Ltd belong to?
Mangalam Drugs And Organics Ltd belongs to the Healthcare sector, operating specifically within the Pharmaceuticals & Drugs segment.
Q.2 Is Mangalam Drugs And Organics Ltd a good quality company?
Mangalam Drugs And Organics 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 Mangalam Drugs And Organics Ltd undervalued or overvalued?
Mangalam Drugs And Organics 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 - 11.73
Price to Book 0.41 1.18
Price to Sales 0.2 0.47
EV to EBITDA 78.99 6.96
Q.4 Is Mangalam Drugs And Organics Ltd a good buy now?
Mangalam Drugs And Organics 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 Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd revenue growth is -13.7% for FY-2025, which is below its 5-year CAGR of 2.42%, indicating slower growth.

Q.2 Gross Profit margin of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Gross profit margin which is the profit after deduction of direct costs, is 6.7% for FY-2025, which is in line with its 5-year median of 6.7%, indicating stable margins.

Q.3 Operating Profit Margin of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 11.36% for FY-2025, which is in line with its 5-year median of 10.88% indicating stable margins.

Q.4 Net Profit Margin of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Net Profit Margin is 2.18% for FY-2025, is in line with its 5-year median of 2.18%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 6.7 6.7
Operating Profit Margin (%) 11.36 10.88
Net Profit Margin (%) 2.18 2.18

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Return on Asset is 1.93%, which is in line with its 5-year historical median of 1.93%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Return on capital employed is 8.4% for FY-2025, which is in line with its 5-year historical median of 8.4%. 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 Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Return on equity is 4.76% for FY-2025, which is in line with its 5-year historical median of 4.76%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Cash conversion cycle is 82 days, above its 5-year historical median of 70 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.89 1.08
ROE (%) 4.76 4.76
ROCE (%) 8.4 8.4
Cash Conversion Cycle 82 days 70 days

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

Q.9 Debt to Equity ratio of Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Debt-to-Equity ratio is 0.59, 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 Mangalam Drugs And Organics Ltd?
Mangalam Drugs And Organics Ltd Debt to cash flow from operations is 2.06, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Mangalam Drugs And Organics Ltd?

Q.1 Promoter shareholding and pledge status of Mangalam Drugs And Organics Ltd?
Promoters hold 35.65% of the Mangalam Drugs And Organics Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Mangalam Drugs And Organics Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Mangalam Drugs And Organics Ltd vs industry peers?
Mangalam Drugs And Organics Ltd revenue CAGR is 2.42%, compared to the industry median CAGR of 5.52%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -13.7 5.5
Gross Profit Growth (%) 498.6 13.9
Operating Profit Growth (%) 106 11.6
Net Profit Growth (%) 0 12.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.89 0.79
ROE (%) 4.76 9.17
ROCE (%) 8.4 11.52
Cash Conversion Cycle (days) 82.43 76

Valuation & price assessment

Q.1 Stock return of Mangalam Drugs And Organics Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of -18.4% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
-18.4% -25.5% -35.2% -57.6%
Q.2 Valuation ratios of Mangalam Drugs And Organics Ltd vs historical?
The current P/E ratio of 0 is lower than its historical median of 11.73, 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 - 11.73 31.09
Price to Book 0.41 1.18 2.85
Price to Sales 0.2 0.47 2.82
EV to EBITDA 78.99 6.96 15.99

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