SMS Pharmaceuticals Limited (SMSPHARMA) AI Stock Analysis

• Market Cap: ₹34.65B
• Dividend Yield: 0.13%
• Average Volume (3M): 105.50K
• Price to Earnings (P/E): 30.0
• Beta (1Y): 1.65
• Revenue Growth: 11.91%
• EPS Growth: 36.92%
• Country: IN
• Employees: 1,197
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - General
• EPS (TTM): 2.51
• Shares Outstanding: 93,652,030
• 10 Day Avg. Volume: 15,241
• 30 Day Avg. Volume: 105,503
• PEG Ratio: 0.70
• Price to Book (P/B): 2.91
• Price to Sales (P/S): 2.38
• P/FCF Ratio: -31.61
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: ₹402.00 ▲(23.54% Upside)
• Action: Reiterated Date: 11/28/25
• Date: Action: Reiterated 11/28/25

SMS Pharmaceuticals Limited's overall stock score reflects its strong technical momentum and stable financial foundation, tempered by valuation concerns and operational challenges. The stock's upward trend is a positive indicator, but potential overvaluation and cash flow issues warrant caution.

Positive Factors

Revenue Growth Trend

Sustained revenue growth near 15% demonstrates persistent end-market demand and successful commercial execution across product lines. Over a 2-6 month horizon this supports scale economics, capacity utilization, and the company's ability to invest in R&D or capacity, improving long-term margin sustainability.

Diversified Market Access

Serving both domestic formulators and export customers reduces single-market concentration and smooths demand cycles. Durable access to international and local customers supports repeat contract flows, aids customer qualification leverage, and provides multiple channels for growth and risk mitigation over time.

Balance Sheet Stability

A moderate leverage profile with a relatively strong equity ratio indicates financial flexibility to fund working capital and capital expenditure. This balance supports resilience to shocks, ability to pursue incremental capacity or regulatory compliance investments, and preserves long-term strategic optionality.

Negative Factors

Cash Flow Volatility

Inconsistent free cash flow and fluctuating operating-cash-to-net-income ratios signal uneven cash generation. Over several quarters this can constrain reinvestment, limit deleveraging or dividend capacity, and force reliance on external financing for capex or working capital, increasing long-term financial risk.

Net Income Volatility

A material net income decline and a negative margin year highlight underlying cost, pricing or operational issues. Persistent profitability volatility undermines return metrics, complicates multi-year planning, and can reduce retained earnings available for growth or to absorb industry headwinds over time.

Rising Leverage Risk

Although current leverage is moderate, the noted increase in debt levels raises interest and refinancing risk if continued. Over a medium-term horizon rising debt without consistent cash conversion can erode financial flexibility, increase funding costs, and pressure margins during slower demand periods.

SMS Pharmaceuticals Limited Business Overview & Revenue Model

Company Description

SMS Pharmaceuticals Limited manufactures and sells active pharmaceutical ingredients (APIs) and intermediates in India. The company offers anti-ulcer, anti-fungal, anti-migraine, anti-diabetic, erectile dysfunction, antiemetic, antiepileptic, antipsychotic, anti-hypertensive, anti-anginal, anti-viral, urinary antispasmodic, and anti-retroviral APIs. It is also involved in the contract research activities. The company also exports its products. SMS Pharmaceuticals Limited was incorporated in 1987 and is based in Hyderabad, India.

How the Company Makes Money

SMS Pharmaceuticals generates revenue through multiple streams, primarily by selling its APIs and finished formulations to pharmaceutical companies globally. The company has established significant partnerships with various domestic and international firms, allowing it to supply its products on a large scale. Additionally, SMSPHARMA focuses on research and development to create new products and improve existing formulations, which helps to expand its market reach and enhance profitability. Revenue is also bolstered by compliance with regulatory standards, enabling the company to enter and maintain a strong presence in regulated markets.

SMS Pharmaceuticals Limited Financial Statement Overview

Summary

SMS Pharmaceuticals Limited shows solid revenue growth and a stable balance sheet, but faces challenges with net income volatility and inconsistent cash flow. These issues highlight potential operational inefficiencies and liquidity constraints.

Income Statement

SMS Pharmaceuticals Limited's revenue has shown a steady growth trajectory from 2020 to 2025, with notable year-on-year increases. However, the gross profit margin has seen some fluctuations, and there was a significant drop in net income in 2023, leading to a negative net profit margin that year. The EBIT and EBITDA margins have generally remained healthy, but the volatility in net income suggests some underlying issues with cost management or operational efficiency.

Balance Sheet

The company maintains a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. The equity ratio is relatively strong, reflecting solid asset backing by equity. Return on equity has generally been positive, except for a negative ROE in 2023 due to the negative net income. Overall, the balance sheet suggests financial stability, though the increasing debt levels warrant monitoring.

Cash Flow

Operating cash flow has been positive, but free cash flow has fluctuated significantly, with negative figures in some years, highlighting potential liquidity constraints. The operating cash flow to net income ratio is inconsistent, further indicating volatility in cash generation relative to earnings. These fluctuations suggest challenges in maintaining consistent cash flow, possibly due to high capital expenditures or operational inefficiencies.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	8.14B	7.83B	7.09B	5.22B	5.15B	5.61B
Gross Profit	2.31B	1.45B	2.11B	1.29B	1.81B	1.81B
EBITDA	1.50B	1.45B	1.18B	593.89M	1.20B	1.25B
Net Income	731.47M	691.36M	498.26M	-70.59M	622.20M	625.27M
Balance Sheet
Total Assets	0.00	11.53B	10.34B	8.80B	8.60B	8.12B
Cash, Cash Equivalents and Short-Term Investments	415.86M	415.86M	361.16M	73.78M	465.83M	404.23M
Total Debt	0.00	3.11B	2.81B	2.54B	2.63B	2.55B
Total Liabilities	-6.40B	5.13B	4.98B	4.19B	3.89B	4.02B
Stockholders Equity	6.40B	6.40B	5.36B	4.61B	4.70B	4.11B
Cash Flow
Free Cash Flow	0.00	-588.57M	-20.35M	-74.71M	129.86M	-612.96M
Operating Cash Flow	0.00	645.23M	501.25M	224.50M	402.34M	904.53M
Investing Cash Flow	0.00	-1.24B	-520.72M	-296.86M	-271.53M	-1.52B
Financing Cash Flow	0.00	644.32M	306.79M	-319.69M	-69.21M	920.18M

SMS Pharmaceuticals Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 325.40
• 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:SMSPHARMA, the sentiment is Positive. The current price of 325.4 is below the 20-day moving average (MA) of 353.50, below the 50-day MA of 332.96, and above the 200-day MA of 281.65, indicating a bullish trend. The MACD of 15.77 indicates Negative momentum. The RSI at 61.06 is Neutral, neither overbought nor oversold. The STOCH value of 64.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:SMSPHARMA.

SMS Pharmaceuticals Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SMSPHARMA	65 Neutral	₹34.65B	29.96	―	0.13%	11.91%	36.92%
MOREPENLAB	57 Neutral	₹22.84B	20.54	―	0.49%	-0.29%	-29.04%
MEDIASSIST	56 Neutral	₹26.49B	205.09	―	0.92%	―	―
SOLARA	54 Neutral	₹22.27B	-36.05	―	―	-4.18%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
BAJAJHCARE	51 Neutral	₹10.14B	20.91	―	0.24%	13.04%	―
INDOCO	49 Neutral	₹18.23B	-18.14	―	0.08%	-2.81%	-444.69%

SMS Pharmaceuticals Limited Corporate Events

SMS Pharmaceuticals Sets Up Wholly Owned Subsidiary SMS coLab for Greenfield Pharma Expansion

SMS Pharmaceuticals Limited has incorporated a new wholly owned subsidiary, SMS coLab Private Limited, following approval from the Ministry of Corporate Affairs on 23 December 2025, with an authorised capital of Rs. 15 lakh and paid-up capital of Rs. 1 lakh. The new entity, positioned as a greenfield project within the pharmaceuticals industry, is intended to focus on manufacturing pharmaceutical products in new therapeutic categories, as well as undertaking research, development, production, commercialization and distribution of a wide range of pharmaceutical products and related equipment, signalling an expansion of SMS Pharmaceuticals’ operational footprint and future growth ambitions.

SMS Pharmaceuticals Completes Successful USFDA Inspection at Vizag Facility

SMS Pharmaceuticals Limited announced the successful completion of a USFDA inspection at its Vizag manufacturing facility, which specializes in large-volume API production. The inspection concluded with one minor procedural observation, not related to data integrity, and the company will respond to the USFDA within the required timeframe. This achievement underscores SMS Pharma’s commitment to quality and compliance, reinforcing its position as a reliable partner in the global pharmaceutical industry and ensuring continued high-quality API supply to international markets.