Dr Lal Pathlabs Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Dr Lal Pathlabs Ltd trades at ₹1,687, in a confirmed uptrend and 8 weeks into that stage. That is +10.8% against its own 200-day average. It sits at 88% of a 52-week range of ₹1,308 to ₹1,737. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 2 straight weeks.

Today the stock is in a confirmed uptrend — week 8 of stage 2, confirmed. At ₹1,687 it trades +10.8% versus its 200-day average and sits at 88% of its 52-week range (₹1,308–₹1,737).

Against the market, two honest reads. Cumulative: over the last 10.3 years the stock moved +291% while the NIFTY 500 moved +274% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 2 straight weeks — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

→ The trend is one thing; the bill is another. Are you paying up for it? Next: the P/E sits at the 42nd percentile of its own range.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Dr Lal Pathlabs Ltd trades at 52.4× P/E, mid-range by its own standards (42nd percentile). Its long-run median P/E is 55.0×, measured across 10.4 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 52.4× is mid-range by its own standards (42nd percentile), against a long-run median of 55.0× measured over 10.4 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

One caveat before moving on: margins are the best this company has ever printed — cheap against its own history on record margins is not the same thing as cheap. If profitability mean-reverts, today's multiple is higher than it looks.

Why the multiple sits where it does: over the past year annual EPS moved +3.4% against a +12.4% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the −0.2%/yr price move, ~+13.9%/yr came from earnings growth and ~−14.1 pp from the multiple (compressing); over 10y, of the +13.1%/yr price move, ~+14.9%/yr came from earnings growth and ~−1.8 pp from the multiple (compressing). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is unremarkable against its own past, so the story rests on the earnings line underneath it, not the multiple.

→ Cheap or dear rides on the earnings. Are they actually growing? Next: the fundamental stage — where the business sits in its arc, and how growth has compounded.

Stage: Topping out Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Dr Lal Pathlabs Ltd reads as topping out on its fundamental arc. Topping out — profit and EPS growth have decelerated hard (profit growth +44.9% at its peak → +5.0% latest) while ROCE still reads 27.6%. The read is built from 12 quarters across 4 curves, on full evidence.

Why it matters: decelerating from a peak is where good stories quietly end — the multiple usually notices late.

→ The stage names the trajectory. Next: the revenue line that produces it, quarter by quarter.

4-Factor Sector Score

No sector-relative score — Dr Lal Pathlabs Ltd is not present in the sector comparison for Diagnostics.

The score is a rank WITHIN a peer set: every metric is scored by percentile against the other members. Without the peer set there is no score to state, so none is invented here.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Dr Lal Pathlabs Ltd reported ₹798 Cr of revenue in the Jun 26 quarter, +19.1% year on year. That is the 12th straight quarter of year-on-year growth. Over 10 years it has compounded at 13.3% a year. The last full year, FY26, came in at ₹2,763 Cr. The last four reported quarters add to ₹2,892 Cr.

Dr Lal Pathlabs Ltd reported ₹798 Cr of revenue in the Jun 26 quarter, +19.1% year on year. That is the 12th straight quarter of year-on-year growth. Over 10 years it has compounded at 13.3% a year. The last full year, FY26, came in at ₹2,763 Cr. The last four reported quarters add to ₹2,892 Cr.

FY26 revenue came in at ₹2,763 Cr (+12.3% on the year), capping 10 years at 13.3% compound. The latest quarter (Jun 26) printed ₹798 Cr, +19.1% year on year — the 12th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +14.3% growth against the decade's 13.3% — the current year is running in line with its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +14.3% over the last 4 quarters against +12.5%/yr over the last 8 — stabilising; TTM profit +5.0% vs +18.7%/yr — rolling over.

→ Revenue grew — did margins hold as it scaled? Next: 31.0% this quarter (+2.0 pp YoY).

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Dr Lal Pathlabs Ltd's operating margin is 31.0% in the Jun 26 quarter, +2.0 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 13 fiscal years the operating margin has ranged 24.0% to 28.0%. The current quarter is running above every full year in that window.

Dr Lal Pathlabs Ltd's operating margin is 31.0% in the Jun 26 quarter, +2.0 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 13 fiscal years the operating margin has ranged 24.0% to 28.0%. The current quarter is running above every full year in that window.

The latest quarter's operating margin is 31.0%, +2.0 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 24.0%–28.0%, and FY26's 28.0% is the top of that band — a record year.

Why the margin moved: operating margin went +2.3 pp year on year while gross margin went +0.2 pp — the gain came mostly below the gross line: operating leverage, with costs spread over a bigger revenue base.

Worth repeating from the valuation section: cheap against its own history on record margins is not the same thing as cheap — a record margin flatters every ratio built on top of it.

→ Margins held — did that reach the bottom line? Next: profit +26.9% in the latest quarter.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Dr Lal Pathlabs Ltd earned ₹170 Cr of net profit in the Jun 26 quarter, +26.9% year on year. Full-year FY26 profit was ₹510 Cr. The 10-year compound rate is 14.4%. That is 21.3% of the quarter's revenue. The same quarter a year earlier earned ₹134 Cr.

Dr Lal Pathlabs Ltd earned ₹170 Cr of net profit in the Jun 26 quarter, +26.9% year on year. Full-year FY26 profit was ₹510 Cr. The 10-year compound rate is 14.4%. That is 21.3% of the quarter's revenue. The same quarter a year earlier earned ₹134 Cr.

Jun 26 profit was ₹170 Cr, +26.9% year on year. On the full year, FY26 printed ₹510 Cr (+3.7%), and the 10-year compound rate is 14.4%.

Why profit moved: revenue contributed +19.1% and the margin +2.0 pp — the quarter was margin-led: most of the profit growth came from keeping more of each sale.

Pace comparison, last four quarters: profit +5.1% vs revenue +14.3%. Profit is growing slower than sales — costs are eating the growth before it reaches the bottom line.

→ Profit rose — but did the cash follow? Next: 128% of the last 3 years' profit arrived as cash.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 128% of Dr Lal Pathlabs Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹636 Cr of operating cash against ₹510 Cr of profit. After ₹254 Cr of capital spending, ₹382 Cr was left as free cash.

FY26: operating cash of ₹636 Cr against reported profit of ₹510 Cr, leaving free cash of ₹382 Cr after ₹254 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 128% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 128%: the cash cycle held roughly steady between FY21 and FY26 — so conversion tracks profitability rather than the cycle.

Router verdict: no single sink dominates — the next section checks both the working-capital cycle and the capital spending.

→ So follow the cash to where it goes. Next: a −79-day cycle and ₹401 Cr of building.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Dr Lal Pathlabs Ltd's cash conversion cycle runs −79 days in FY26, down from −78 days in FY21. Capital spending ran ₹401 Cr over the last 3 years. At FY26 sales of ₹2,763 Cr each day of that cycle holds about ₹7.6 Cr, so roughly ₹−598 Cr sits inside the business at any moment.

FY26: debtors at 15 days, inventory at 30 days — roughly 1.0 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of −79 days, tighter than FY21's −78.

The full loop: cash goes out to suppliers and production on day 0; stock waits 30 days to sell; customers pay about 15 days after that; and suppliers themselves are paid at 123 days — netting out to the −79-day cycle.

In money terms: at FY26 sales of ₹2,763 Cr, each day of the cycle holds about ₹7.6 Cr — so the −79-day loop keeps roughly ₹−598 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹401 Cr over the last 3 fiscal years against ₹448 Cr of depreciation — spending at or below maintenance level. Capital work-in-progress stands at ₹7.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: neither the cycle nor the build-out is hoarding the cash — the machine is reasonably clean.

→ Does all this activity actually earn its cost of capital? Next: ROCE is 28% and the ROIC − WACC spread is +24.3 pp.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Dr Lal Pathlabs Ltd earns a ROCE of 28% in FY26. That is up from a trough of 18% in FY23. Return on invested capital clears the cost of that capital by +24.3 percentage points, so growth here adds value rather than only size. The wiring behind it is 18.5% net margin on 0.88× asset turns.

FY26 ROCE is 28%, recovered from a FY23 trough of 18% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 18.5% net margin × 0.88× asset turns × 1.25× balance-sheet leverage ≈ 20.4% on equity. Margin is doing the heavy lifting; leverage is modest — this is an earned return, not a borrowed one.

The capstone test — ROIC − WACC: 36.3% − 12.0% = a +24.3 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. A spread this wide means every rupee reinvested creates more than a rupee of value — the engine compounds.

→ Returns like these — is the balance sheet borrowing to make them? Next: debt-to-equity is 0.08.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

Dr Lal Pathlabs Ltd carries total debt of ₹199 Cr against shareholder equity of ₹2,541 Cr as of Mar 26, a debt-to-equity of 0.08 — effectively unlevered. On the annual view that ratio went from 0.35 in FY22 to 0.08 in FY26. The returns elsewhere on this page are therefore earned rather than borrowed.

Mar 26: total debt of ₹199 Cr against shareholder equity of ₹2,541 Cr — a debt-to-equity of 0.08. On the annual view, debt-to-equity went from 0.35 (FY22) to 0.08 (FY26). The returns on this page are earned, not borrowed.

→ Who owns this, and are they adding or leaving? Next: Domestic institutions added 9.2 points over 8 quarters.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Domestic institutions added 9.2 points of Dr Lal Pathlabs Ltd over 8 quarters, the biggest move on the register. That takes domestic institutions to 21.6% of the company. Foreign institutions moved −8.1 points over the same window, to 17.4%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Domestic institutions: +9.2 points over 8 quarters to 21.6%; Foreign institutions: −8.1 points over 8 quarters to 17.4%; Promoters: −1.4 points over 8 quarters to 53.2%.

Why the register moved: rotation — foreign institutions −8.1 points against domestic institutions +9.2 points over 8 quarters, with promoters −1.4 points — one class of institutions handing the register to the other, not a verdict change by the people closest to the numbers.

→ One last check: does the safety math agree? Next: the balance-sheet safety line.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Dr Lal Pathlabs Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

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