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Divis Laboratories Ltd

NSE: DIVISLAB BSE: 532488

6056

(0.08)%

Sun, 01 Feb 2026, 05:27 pm

Analysis

dividend

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Pros

  • Dividends per share have increased over the past 10 years.
  • Dividends paid are well covered by earnings (3.2x coverage).
  • Dividends after 3 years are expected to be well covered by earnings (3.1x coverage).
  • Dividends per share have been stable in the past 10 years.
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Cons

  • Divi's Laboratories's pays a lower dividend yield than the bottom 25% of dividend payers in India (0.76%).
  • Divi's Laboratories's dividend is below the markets top 25% of dividend payers in India (3.08%).

future

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Pros

  • Divi's Laboratories's earnings growth is expected to exceed the India market average.
  • Divi's Laboratories's earnings growth is expected to exceed the low risk savings rate of 7.2%.
  • Divi's Laboratories's earnings are expected to exceed the low risk growth rate next year.
  • Divi's Laboratories's earnings are expected to increase by more than the low risk growth rate in 3 years time.
  • Divi's Laboratories is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
  • Performance (ROE) is expected to be above the current IN Life Sciences industry average.
  • An improvement in Divi's Laboratories's performance (ROE) is expected over the next 3 years.
  • Divi's Laboratories's revenue growth is expected to exceed the India market average.
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Cons

  • Cash flow for Divi's Laboratories is expected to increase but not above the 50% threshold in 2 years time.
  • Divi's Laboratories's earnings are expected to grow by 18.9% yearly, however this is not considered high growth (20% yearly).
  • Divi's Laboratories's net income is expected to increase but not above the 50% threshold in 2 years time.
  • Divi's Laboratories's revenue is expected to increase but not above the 50% threshold in 2 years time.
  • Divi's Laboratories's revenue is expected to grow by 12.8% yearly, however this is not considered high growth (20% yearly).

health

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Pros

  • Divi's Laboratories is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Divi's Laboratories is profitable, therefore cash runway is not a concern.
  • Divi's Laboratories is profitable, therefore cash runway is not a concern.
  • Debt is well covered by operating cash flow (3615.6%, greater than 20% of total debt).
  • Debt is covered by short term assets, assets are 139.2x debt.
  • Divi's Laboratories's cash and other short term assets cover its long term commitments.
  • The level of debt compared to net worth has been reduced over the past 5 years (0.8% vs 0.5% today).
  • Interest payments on debt are well covered by earnings (EBIT is 268.2x coverage).
  • Divi's Laboratories's level of debt (0.5%) compared to net worth is satisfactory (less than 40%).
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Cons

  • High level of physical assets or inventory.

management

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Pros

  • The average tenure for the Divi's Laboratories board of directors is over 10 years, this suggests they are a seasoned and experienced board.
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Cons

  • Kiran's remuneration is higher than average for companies of similar size in India.
  • Kiran's compensation has increased by more than 20% in the past year whilst earnings grew less than 20%.
  • Divi's Laboratories individual insiders have only sold shares in the past 3 months.

past

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Pros

  • Divi's Laboratories's year on year earnings growth rate has been positive over the past 5 years.
  • Divi's Laboratories used its assets more efficiently than the IN Life Sciences industry average last year based on Return on Assets.
  • Divi's Laboratories's earnings growth has exceeded the IN Life Sciences industry average in the past year (1.8% vs -6.2%).
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Cons

  • Divi's Laboratories's 1-year earnings growth is less than its 5-year average (1.8% vs 7.9%)
  • Divi's Laboratories's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
  • Divi's Laboratories has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).

value

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Pros

  • 532488 outperformed the Life Sciences industry which returned 36.1% over the past year.
  • 532488 outperformed the Market in India which returned -14.5% over the past year.
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Cons

  • Divi's Laboratories's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).
  • Divi's Laboratories's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).
  • Divi's Laboratories is overvalued based on assets compared to the IN Life Sciences industry average.
  • Divi's Laboratories is poor value based on expected growth next year.
  • Divi's Laboratories is overvalued based on earnings compared to the IN Life Sciences industry average.
  • Divi's Laboratories is overvalued based on earnings compared to the India market.
  • BSE:532488 is flat (-0.7%) underperforming the Life Sciences industry which returned 2.6% over the past month.
  • BSE:532488 is flat (-0.7%) underperforming the market in India which returned 8% over the past month.

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