Sakar Healthcare Ltd (SAKAR) AI Stock Analysis

• Market Cap: ₹11.82B
• Dividend Yield: N/A
• Average Volume (3M): 19.08K
• Price to Earnings (P/E): 22.2
• Beta (1Y): 0.65
• Revenue Growth: 24.20%
• EPS Growth: 55.01%
• Country: IN
• Employees: 325
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 4.61
• Shares Outstanding: 21,949,910
• 10 Day Avg. Volume: 18,950
• 30 Day Avg. Volume: 19,083
• PEG Ratio: 0.71
• Price to Book (P/B): 1.79
• Price to Sales (P/S): 2.88
• P/FCF Ratio: -37.75
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹605.00
• Price Target Upside: 48.81% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ₹565.00 ▲(38.97% Upside)
• Action: Reiterated Date: 02/10/26
• Date: Action: Reiterated 02/10/26

The score is primarily driven by solid financial momentum (revenue growth and improving EBIT margin) but is held back by profitability/cash-flow concerns (sharp gross margin compression and negative free cash flow). Technically, the trend is strong with the price above major moving averages, while valuation is a headwind due to the elevated P/E and no dividend yield.

Positive Factors

Revenue Growth

Consistent ~15% annual revenue growth demonstrates durable demand and expanding market penetration across domestic, export and contract-manufacturing channels. Sustained top-line momentum supports scale benefits, long-term investment capacity and strategic reinvestment into higher-margin lines.

Operating Margin Improvement

A material rise in EBIT margin reflects improving operational efficiency and better absorption of fixed costs. If maintained, this structural improvement increases earnings resilience and cash generation potential, enabling reinvestment or deleveraging over the medium term.

Strong Equity Position & Lower Leverage

High equity ratio and reduced debt-to-equity strengthen the balance sheet, lowering financial risk and increasing flexibility to fund capex, acquisitions or working-capital needs. This structural solidity supports sustained operations through industry cycles.

Negative Factors

Sharp Gross Margin Compression

A severe, year-over-year gross margin decline suggests structural pressure from input cost inflation, pricing erosion or adverse product-mix shift. Persisting margin compression would materially limit sustained profitability and weaken the company’s ability to fund capex or improve free cash flow.

Negative Free Cash Flow

Ongoing negative free cash flow implies the business still relies on external funding or working-capital financing for growth. Even with improving OCF conversion, continued FCF deficits constrain durable self-funding of expansion and raise financing and liquidity risks over the medium term.

Modest Returns on Equity

A low mid-single-digit ROE signals modest returns relative to capital employed, limiting long-term shareholder wealth creation if unchanged. Combined with margin pressures, this suggests the company must improve operational returns or pursue higher-margin segments to lift sustainable profitability.

Sakar Healthcare Ltd Business Overview & Revenue Model

Company Description

Sakar Healthcare Limited research, develops, manufactures, and markets pharmaceutical products in India. The company provides liquid orals, cephalosporin tablets, capsules, dry powder syrups, dry powder injections, liquid injectable SVP in ampoules, vials and lyophilized injections, and oral solid dosages. Its product portfolio consists of formulations in approximately 22 therapeutic areas, such as antacid, antimalerial, anticoagulant, laxative, anthelmintic, bronchodilator, anaesthetic, antidepressant, sedative, adrenergic, anti-infective, diuretics, oxytocic, analgesic, antiemetic, antipsychotic, antifungal, PPI, anticonvulsant, anti-inflammatory, antihistamine, and multi vitamins. The company also exports its products to approximately 38 countries, including Southeast Asia, Asia, Africa-Anglo and Francophone, MENA countries, and the United States. Sakar Healthcare Limited was incorporated in 2004 and is based in Ahmedabad, India.

How the Company Makes Money

Sakar Healthcare primarily makes money by selling pharmaceutical finished-dosage formulations. Its revenue is generated from (1) branded and/or generic formulations sold into the Indian market via distributors/stockists and channel partners, and (2) exports of pharmaceutical products to international customers. A further revenue stream comes from contract manufacturing and/or loan-licensing/third-party manufacturing arrangements where the company manufactures formulations for other marketing companies or supplies products under customer-specific requirements. Earnings are influenced by product mix (higher-margin therapies and differentiated formulations), manufacturing utilization and operating efficiency, regulatory compliance for export markets, and the scale and reach of its distribution/export customer relationships. Specific named partnerships, customer concentrations, or segment-level revenue splits: null.

Sakar Healthcare Ltd Financial Statement Overview

Summary

Strong revenue growth (~15% YoY) and improved EBIT margin (16.2% in 2025 vs 12.9% in 2024) support the score, but the sharp gross margin drop (45.3% to 24.1%) and negative free cash flow (despite improvement) meaningfully temper overall financial quality.

Income Statement

Sakar Healthcare Ltd has demonstrated a consistent increase in revenue over the years, with a notable revenue growth rate of 15.2% in 2025 compared to 2024, and 15.6% from 2024 to 2023. The Gross Profit Margin has been fluctuating but remained strong, standing at 24.1% for 2025. However, the Net Profit Margin has been lower at 9.9% for 2025, indicating higher operating costs or expenses. The EBIT margin improved to 16.2% in 2025 from 12.9% in 2024, showing operational efficiency. Nonetheless, the drop in Gross Profit Margin from 45.3% in 2024 to 24.1% in 2025 is a concern.

Balance Sheet

The company's Debt-to-Equity ratio has improved, decreasing from 0.30 in 2024 to 0.26 in 2025, indicating a reduction in leverage. The Return on Equity (ROE) has been stable, with 6.1% in 2025, showcasing moderate profitability relative to equity. The Equity Ratio stood at 68.8% in 2025, reflecting a strong equity position. Despite the positive trends, the ratio of Total Debt to Stockholders' Equity remains notable, requiring careful monitoring.

Cash Flow

The Free Cash Flow has been negative but shows signs of improvement, with a 61.4% increase in 2025 compared to 2024. The Operating Cash Flow to Net Income ratio was strong at 1.07 in 2025, indicating that the company is efficiently converting its net income into cash. However, the Free Cash Flow to Net Income ratio remains negative, suggesting challenges in covering capital expenditures solely through operational earnings.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	1.89B	1.78B	1.54B	1.33B	1.28B	947.39M
Gross Profit	680.80M	427.91M	699.59M	598.12M	534.12M	432.46M
EBITDA	528.86M	509.44M	393.27M	378.12M	315.72M	237.73M
Net Income	197.61M	175.02M	116.71M	127.59M	152.43M	106.83M
Balance Sheet
Total Assets	0.00	4.15B	3.89B	3.36B	2.68B	1.78B
Cash, Cash Equivalents and Short-Term Investments	3.09M	3.09M	4.66M	35.23M	71.36M	824.65K
Total Debt	0.00	749.55M	793.52M	1.19B	928.62M	425.97M
Total Liabilities	-2.85B	1.30B	1.26B	1.63B	1.40B	793.40M
Stockholders Equity	2.85B	2.85B	2.62B	1.73B	1.27B	984.52M
Cash Flow
Free Cash Flow	0.00	-135.52M	-350.93M	-468.81M	-618.33M	-209.69M
Operating Cash Flow	0.00	187.31M	244.67M	353.14M	356.99M	145.77M
Investing Cash Flow	0.00	-307.09M	-515.39M	-743.77M	-903.72M	-468.33M
Financing Cash Flow	0.00	-34.79M	274.45M	410.96M	320.33M	320.33M

Sakar Healthcare Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 406.55
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SAKAR, the sentiment is Positive. The current price of 406.55 is below the 20-day moving average (MA) of 499.03, below the 50-day MA of 442.27, and above the 200-day MA of 377.35, indicating a bullish trend. The MACD of 26.80 indicates Negative momentum. The RSI at 65.56 is Neutral, neither overbought nor oversold. The STOCH value of 67.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:SAKAR.

Sakar Healthcare Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VENUSREM	72 Outperform	₹10.49B	10.01	―	―	13.32%	218.38%
SAKAR	66 Neutral	₹11.82B	22.21	―	―	24.20%	55.01%
INDSWFTLAB	61 Neutral	₹11.61B	18.86	―	―	-37.70%	-19.79%
KILITCH	57 Neutral	₹5.59B	34.53	―	―	32.95%	67.39%
MEDICAMEQ	57 Neutral	₹3.93B	56.53	―	0.26%	-9.16%	49.09%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
NECLIFE	46 Neutral	₹2.53B	7.63	―	―	-30.27%	-3470.06%

Sakar Healthcare Ltd Corporate Events

Sakar Healthcare Files SEBI Demat Compliance Certificate for December 2025 Quarter

Sakar Healthcare Limited has submitted a compliance certificate to the stock exchange confirming adherence to Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018 for the quarter ended 31 December 2025. The registrar MUFG Intime India Private Limited has certified that all securities lodged for dematerialisation during the quarter were duly processed, either accepted or rejected, listed on the relevant stock exchanges, and that physical certificates were cancelled and depository details updated in the company’s register of members within the prescribed timelines, underscoring the company’s ongoing regulatory compliance and robust securities handling practices for shareholders.

Sakar Healthcare to Supply Imatinib for Accord Healthcare’s EU Market After EMA Approval

Sakar Healthcare Ltd announced that its oncology manufacturing site has been approved as a production source for Accord Healthcare UK’s Imatinib Accord 100 mg and 400 mg film-coated tablets for the European Union market, following an EU variation approval by the European Medicines Agency. This marks the first of nine oncology products that Accord plans to transfer to Sakar, positioning the Indian company as a key supplier for Accord’s European oncology portfolio, and is expected to boost Sakar’s top-line sales and improve capacity utilisation while enabling it to prepare for supplying a broader range of approved products overseas.