The average target price of SUPRIYA.NS is 740 and suggests 5% upside potential. Usually, this means a HOLD recommendation among investment firms. This neutral recommendation suggests no significant price movement, up or down, in the next 12 months. The most optimistic analyst has a target price of 740.0. This translates into 5% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 740.0. This suggests 5% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

Supriya Lifescience Ltd., a bulk drugs company, engages in the research and development, manufacture, and sale of active pharmaceutical ingredients worldwide. It offers active pharmaceutical ingredients, such as anti-histamine, anti-allergic, anti-asthmatic, decongestant, analgesic/anti-pyretic/anesthetic, smoking cessation, antihypertensive, and anti-malarial products, as well as vitamins, feed additives, xanthine derivatives and beverages, and phytochemicals. The company was founded in 1987 and is headquartered in Mumbai, India.

India

Supriya Lifescience Limited

Healthcare

The company pays dividends from time to time. It has paid dividends in less than half the past ten years. Dividend per share (DPS) has grown yearly, and there is a clear trend. In the past 12 months, the dividend yield has barely been above zero and was substantially below that of its peers. On average, the company pays dividends annually. 

SUPRIYA.NS reported revenue of INR 6 706mn in the last 12 months, up 21% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS grew 45% from FY23 to INR 21.67. Market expects EPS to reach INR 14.30 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Over the past six months the stock has exceeded the performance of this peer group by 10ppts and its growth decelerated by 11ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported strong EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 38.4% in the last 12 months, up from 33.0% in FY23. 

Historically, SUPRIYA.NS has reported very strong net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled 26.0%, a growth from 21.7% in FY23. 

Supriya Lifescience Limited reported a return on equity (RoE) of 20.3% in the last 12 months, up from 15.9% in FY23. The market consensus projects an RoE of 20.4% in FY24, again behind its peers. 

Another important profitability metric, return on assets (RoA), amounted to 18.0% in the last 12 months, an increase from 13.8% in FY23. The market analysts predict that RoA will be 18.1% in FY24, again stronger than its peers. 

In the last 12 months, the return on capital employed (RoCE) grew to 19.6%, above the peers. The consensus estimate for FY24 for RoCE is 27.5%, again ahead of the peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 5.7 in the past several years. This ratio implies a excellent shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are close to minimal. In combination with rigorous business standards, shareholder rights are well protected.

SUPRIYA.NS has average trading liquidity. The average private investor can sell his common position in the stock almost immediately. Liquidity may be unstable and is unfavourable on the days with the lowest activity. However, under highly turbulent market conditions, the trading volume tends to improve significantly. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a small market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is moderate. We note robust profitability, solid return on capital, strong debt servicing capacity, adequate interest coverage, and an favourable capital structure, among the positive credit factors. Among the negative credit factors, we point to weak positions in its industry, excessive margin volatility, and poor cash flow generation.

In highly turbulent market conditions, SUPRIYA.NS is highly volatile. In other words, the stock will fall substantially more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be significant. 

In normal market circumstances, SUPRIYA.NS is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from limited to average. 

Based on key historical and expected multiples, the stock is overvalued relative to its peers. Specifically, the stock is fairly valued on P/E, neutral on EV/EBITDA, overpriced on P/FCF. 

Supriya Lifescience Limited

₹ 712.3

3

Supriya Lifescience Limited

₹ 712.3

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

₹ 712.3

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