Check Before You Invest : Zim Laboratories Ltd

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

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

Q: Is Zim Laboratories Ltd a good quality company?

Zim Laboratories Ltd is a average quality company, based on a somewhat consistent 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 Zim Laboratories Ltd undervalued or overvalued?

Zim Laboratories Ltd appears Somewhat overvalued, as its key valuation ratios are higher 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. Price to Earnings, Current: 89.76, Historic Median: 31.94. Price to Book, Current: 1.87, Historic Median: 2.07. Price to Sales, Current: 1.45, Historic Median: 1.16. EV to EBITDA, Current: 15.17, Historic Median: 10.63

Q: Is Zim Laboratories Ltd a good buy now?

Zim Laboratories 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 Zim Laboratories Ltd?

Zim Laboratories Ltd revenue growth is 2.8% for FY-2025, which is below its 5-year CAGR of 6.49%, indicating slower growth.

Q: Gross Profit margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Gross profit margin which is the profit after deduction of direct costs, is 10% for FY-2025, which is in line with its 5-year median of 10.4%, indicating stable margins.

Q: Operating Profit Margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 11.52% for FY-2025, which is in line with its 5-year median of 11.52% indicating stable margins.

Q: Net Profit Margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Net Profit Margin is 3.13% for FY-2025, is below its 5-year median of 3.95%, indicating decreasing margins. Profitability Metrics. Gross Profit Margin (%), Current: 10, Historic Median: 10.4. Operating Profit Margin (%), Current: 11.52, Historic Median: 11.52. Net Profit Margin (%), Current: 3.13, Historic Median: 3.95

Q: Return on Asset of Zim Laboratories Ltd?

Zim Laboratories Ltd Return on Asset is 2.59%, which is below its 5-year historical median of 3.98%, indicating deteriorated asset utilization efficiency.

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

Zim Laboratories Ltd Return on capital employed is 8.35% for FY-2025, which is below its 5-year historical median of 10.13%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Check Before You Invest : Zim Laboratories Ltd

Snapshot

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

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

Q.2 Is Zim Laboratories Ltd a good quality company?

Zim Laboratories Ltd is a average quality company, based on a somewhat consistent 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 Zim Laboratories Ltd undervalued or overvalued?

Zim Laboratories Ltd appears Somewhat overvalued, as its key valuation ratios are higher 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	89.76	31.94
Price to Book	1.87	2.07
Price to Sales	1.45	1.16
EV to EBITDA	15.17	10.63

Q.4 Is Zim Laboratories Ltd a good buy now?

Zim Laboratories 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 Zim Laboratories Ltd?

Zim Laboratories Ltd revenue growth is 2.8% for FY-2025, which is below its 5-year CAGR of 6.49%, indicating slower growth.

Q.2 Gross Profit margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Gross profit margin which is the profit after deduction of direct costs, is 10% for FY-2025, which is in line with its 5-year median of 10.4%, indicating stable margins.

Q.3 Operating Profit Margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 11.52% for FY-2025, which is in line with its 5-year median of 11.52% indicating stable margins.

Q.4 Net Profit Margin of Zim Laboratories Ltd?

Zim Laboratories Ltd Net Profit Margin is 3.13% for FY-2025, is below its 5-year median of 3.95%, indicating decreasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	10	10.4
Operating Profit Margin (%)	11.52	11.52
Net Profit Margin (%)	3.13	3.95

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Zim Laboratories Ltd?

Zim Laboratories Ltd Return on Asset is 2.59%, which is below its 5-year historical median of 3.98%, indicating deteriorated asset utilization efficiency.

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

Zim Laboratories Ltd Return on capital employed is 8.35% for FY-2025, which is below its 5-year historical median of 10.13%. 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 Zim Laboratories Ltd?

Zim Laboratories Ltd Return on equity is 4.94% for FY-2025, which is below its 5-year historical median of 7.86%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Zim Laboratories Ltd?

Zim Laboratories Ltd Cash conversion cycle is 98 days, above its 5-year historical median of 60 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)	0.83	0.96
ROE (%)	4.94	7.86
ROCE (%)	8.35	10.13
Cash Conversion Cycle	98 days	60 days

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

Q.9 Debt to Equity ratio of Zim Laboratories Ltd?

Zim Laboratories Ltd Debt-to-Equity ratio is 0.46, 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 Zim Laboratories Ltd?

Zim Laboratories Ltd Debt to cash flow from operations is 2.21, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Zim Laboratories Ltd?

Q.1 Promoter shareholding and pledge status of Zim Laboratories Ltd?

Promoters hold 30.35% of the Zim Laboratories Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Zim Laboratories Ltd vs industry peers?

Zim Laboratories Ltd revenue CAGR is 6.49%, compared to the industry median CAGR of 5.35%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	2.8	5.4
Gross Profit Growth (%)	-	14
Operating Profit Growth (%)	7.5	11.5
Net Profit Growth (%)	-29.4	12

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	0.83	0.79
ROE (%)	4.94	9.17
ROCE (%)	8.35	11.52
Cash Conversion Cycle (days)	98.38	76

Valuation & price assessment

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

Over the last 5 year(s), the stock has delivered a CAGR of 26.97% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	-	27%	1%	8.4%

Q.2 Valuation ratios of Zim Laboratories Ltd vs historical?

The current P/E ratio of 89.76 is higher than its historical median of 31.94, indicating that the stock is trading above 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	89.76	31.94	31.09
Price to Book	1.87	2.07	2.85
Price to Sales	1.45	1.16	2.82
EV to EBITDA	15.17	10.63	15.99

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Check Before You Invest : Zim Laboratories Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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