Zydus Wellness 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.

Zydus Wellness Ltd trades at ₹586, in a confirmed uptrend and 13 weeks into that stage. That is +23.8% against its own 200-day average. It sits at 95% of a 52-week range of ₹381 to ₹598. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 25 straight weeks.

Today the stock is in a confirmed uptrend — week 13 of stage 2, confirmed. At ₹586 it trades +23.8% versus its 200-day average and sits at 95% of its 52-week range (₹381–₹598).

Against the market, two honest reads. Cumulative: over the last 10.3 years the stock moved +296% 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 25 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 99th 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.

Zydus Wellness Ltd trades at 78.3× P/E, about the priciest it has ever traded. Its long-run median P/E is 35.6×, 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 78.3× is about the priciest it has ever traded, against a long-run median of 35.6× 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.

🚨 Why the multiple sits where it does: over the past year annual EPS moved −43.1% against a +40.0% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the +5.3%/yr price move, ~−1.8%/yr came from earnings growth and ~+7.1 pp from the multiple (expanding); over 10y, of the +14.1%/yr price move, ~+2.8%/yr came from earnings growth and ~+11.3 pp from the multiple (expanding). 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 full 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: Deteriorating 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).

Zydus Wellness Ltd reads as deteriorating on its fundamental arc. Deteriorating — profit and EPS growth are shrinking (profit growth −43.2% latest against +30.5% at its 12-quarter best), ROCE holding at 4.3%. The read is built from 12 quarters across 4 curves, on full evidence.

🚨 Why it matters: falling curves mean every cheap-looking ratio below needs a discount for direction.

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

4-Factor Sector Score

44.1/100 — rank 8 of 12 in FMCG - Personal Care · 96% evidence confidence

Zydus Wellness Ltd scores 44.1 out of 100 against the 12 companies it is compared with in FMCG - Personal Care, ranking 8. Price leads the evidence: RS versus the benchmark is 26%, but earnings trajectory is weak. Wait for revenue and profit confirmation.

The four contributions add to the total exactly: 10.6 + 8 + 6.3 + 19.2 = 44.1. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

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

Zydus Wellness Ltd reported ₹1,485 Cr of revenue in the Mar 26 quarter, +62.7% year on year. That is the 9th straight quarter of year-on-year growth. Over 10 years it has compounded at 25.9% a year. The last full year, FY26, came in at ₹3,961 Cr. The last four reported quarters add to ₹3,961 Cr.

Zydus Wellness Ltd reported ₹1,485 Cr of revenue in the Mar 26 quarter, +62.7% year on year. That is the 9th straight quarter of year-on-year growth. Over 10 years it has compounded at 25.9% a year. The last full year, FY26, came in at ₹3,961 Cr. The last four reported quarters add to ₹3,961 Cr.

FY26 revenue came in at ₹3,961 Cr (+46.2% on the year), capping 10 years at 25.9% compound. The latest quarter (Mar 26) printed ₹1,485 Cr, +62.7% year on year — the 9th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +51.5% growth against the decade's 25.9% — the current year is running faster than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +46.2% over the last 4 quarters against +30.4%/yr over the last 8 — accelerating; TTM profit −43.2% vs −13.9%/yr — rolling over.

→ Revenue grew — did margins hold as it scaled? Next: 18.0% this quarter (−3.0 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.

Zydus Wellness Ltd's operating margin is 18.0% in the Mar 26 quarter, −3.0 percentage points against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 13.0% to 24.0%. The current quarter sits inside that band.

Zydus Wellness Ltd's operating margin is 18.0% in the Mar 26 quarter, −3.0 percentage points against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 13.0% to 24.0%. The current quarter sits inside that band.

The latest quarter's operating margin is 18.0%, −3.0 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 13.0%–24.0%.

🚨 Why the margin moved: operating margin went −2.6 pp year on year while gross margin went +10.1 pp — the loss came mostly from the gross line: input costs and pricing.

→ Margins slipped — did that reach the bottom line? Next: profit −5.8% 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.

Zydus Wellness Ltd earned ₹162 Cr of net profit in the Mar 26 quarter, −5.8% year on year. Full-year FY26 profit was ₹197 Cr. The 10-year compound rate is 6.5%. That is 10.9% of the quarter's revenue. The same quarter a year earlier earned ₹172 Cr. 2 of the last 12 reported quarters were loss-making.

Zydus Wellness Ltd earned ₹162 Cr of net profit in the Mar 26 quarter, −5.8% year on year. Full-year FY26 profit was ₹197 Cr. The 10-year compound rate is 6.5%. That is 10.9% of the quarter's revenue. The same quarter a year earlier earned ₹172 Cr. 2 of the last 12 reported quarters were loss-making.

Mar 26 profit was ₹162 Cr, −5.8% year on year. On the full year, FY26 printed ₹197 Cr (−43.2%), and the 10-year compound rate is 6.5%.

🚨 Why profit moved: revenue contributed +62.7% and the margin −3.0 pp — the quarter was revenue-led despite a thinner margin.

Pace comparison, last four quarters: profit −284.6% vs revenue +51.5%. 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: 105% 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 105% of Zydus Wellness Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹226 Cr of operating cash against ₹197 Cr of profit. After ₹3,626 Cr of capital spending, ₹−3,400 Cr was left as free cash.

FY26: operating cash of ₹226 Cr against reported profit of ₹197 Cr, leaving free cash of ₹−3,400 Cr after ₹3,626 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 105% 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 105%: the cash cycle stretched 119 days between FY21 and FY26 — more of each rupee of profit waits inside the cycle before arriving.

Router verdict: the bigger cash user is investment — capital spending ran 20.5× depreciation over three years, so the next section's job is to check what that build-out is buying.

→ So follow the cash to where it goes. Next: ₹4,073 Cr of building over 3 years.

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).

Zydus Wellness Ltd's cash conversion cycle runs 106 days in FY26, up from −13 days in FY21. Capital spending ran ₹4,073 Cr over the last 3 years. At FY26 sales of ₹3,961 Cr each day of that cycle holds about ₹10.9 Cr, so roughly ₹1,150 Cr sits inside the business at any moment.

FY26: debtors at 35 days, inventory at 178 days — roughly 5.9 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of 106 days, looser than FY21's −13.

The full loop: cash goes out to suppliers and production on day 0; stock waits 178 days to sell; customers pay about 35 days after that; and suppliers themselves are paid at 107 days — netting out to the 106-day cycle.

In money terms: at FY26 sales of ₹3,961 Cr, each day of the cycle holds about ₹10.9 Cr — so the 106-day loop keeps roughly ₹1,150 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹4,073 Cr over the last 3 fiscal years against ₹199 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹23.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

→ Does all this activity actually earn its cost of capital? Next: ROCE is 5% and the ROIC − WACC spread is −8.5 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.

Zydus Wellness Ltd earns a ROCE of 5% in FY26. That is up from a trough of 5% in FY24. Return on invested capital clears the cost of that capital by −8.5 percentage points, so growth here is not yet paying for the capital it uses. The wiring behind it is 5.0% net margin on 0.39× asset turns.

FY26 ROCE is 5%, recovered from a FY24 trough of 5% — the full ladder below shows the fall and the climb, undoctored.

🚨 Why the return is what it is — the wiring (FY26): 5.0% net margin × 0.39× asset turns × 1.75× balance-sheet leverage ≈ 3.4% on equity. Margin does its share; leverage is a meaningful part of the equation.

The capstone test — ROIC − WACC: 3.5% − 12.0% = a −8.5 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. Negative — growth at these returns destroys value until the returns recover.

→ Returns like these — is the balance sheet borrowing to make them? Next: debt-to-equity is 0.55.

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.

Zydus Wellness Ltd carries total debt of ₹3,203 Cr against shareholder equity of ₹5,826 Cr as of Mar 26, a debt-to-equity of 0.55. On the annual view that ratio went from 0.08 in FY22 to 0.55 in FY26. Read the returns elsewhere on this page with that leverage in mind.

Mar 26: total debt of ₹3,203 Cr against shareholder equity of ₹5,826 Cr — a debt-to-equity of 0.55. On the annual view, debt-to-equity went from 0.08 (FY22) to 0.55 (FY26). Read the returns on this page with that leverage in mind.

→ Who owns this, and are they adding or leaving? Next: the register is quiet.

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.

No holder of Zydus Wellness Ltd moved a full percentage point over the last two years — the register is quiet. Promoters moved +0.0 points over the same window, to 69.6%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Domestic institutions: −0.3 points over 8 quarters to 19.1%; Promoters: +0.0 points over 8 quarters to 69.6%; Foreign institutions: +0.0 points over 8 quarters to 3.3%.

→ 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.

Zydus Wellness Ltd: the Z-score reads 2.66. A Z-score above roughly 3 reads as safe and below roughly 1.8 as the distress zone, so this sits in the grey band between the two. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure.

Why it matters: a Z-score of 2.66 sits in the grey band — neither clearly safe nor clearly distressed.

The safety line in one sentence: the Z-score reads 2.66.

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