Solara Active Pharma Sciences Ltd. (SOLARA) AI Stock Analysis

• Market Cap: ₹22.27B
• Dividend Yield: N/A
• Average Volume (3M): 37.94K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.21
• Revenue Growth: -4.18%
• EPS Growth: N/A
• Country: IN
• Employees: 2,156
• Sector: Healthcare
• Sector Strength: 45
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): -3.92
• Shares Outstanding: 48,170,063
• 10 Day Avg. Volume: 26,889
• 30 Day Avg. Volume: 37,944
• PEG Ratio: -36.57
• Price to Book (P/B): 1.81
• Price to Sales (P/S): 1.54
• P/FCF Ratio: 11.43
• 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: 54 Neutral
• Price Target: ₹481.00 ▼(-17.47% Downside)
• Action: Reiterated Date: 02/07/26
• Date: Action: Reiterated 02/07/26

The score is held up mainly by improving operating performance and notably stronger free cash flow, but is capped by extremely weak net profitability/ROE and bearish technicals (below major DMAs with negative MACD). Valuation is also a modest drag due to a negative P/E and no dividend support.

Positive Factors

Improving operating margins & FCF

Core operations exhibit durable improvement: gross margin of 51.2% and EBIT margin rebound to 34.7% indicate structural cost competitiveness in API manufacture. Coupled with 155% FCF growth, the business has greater ability to fund capex, compliance and debt reduction without relying on external capital.

Moderate leverage and solid equity base

A balanced capital structure (D/E ~0.73, equity ~49%) provides durable financial flexibility for a capital‑intensive API and CDMO business. This reduces refinancing strain, supports investment in regulated‑market capacity, and cushions operating volatility over the medium term.

Strong cash generation improvement

Material free cash flow improvement and strong operating cash conversion signal better cash conversion from operations. Sustained cash generation supports working capital, funds compliance or expansion capex, and reduces dependence on external financing for strategic initiatives.

Negative Factors

Very weak net profitability and ROE

Despite operational margin recovery, negligible net margin and ROE near zero indicate persistent non‑operational drains or inefficiencies. Long‑term shareholder value is constrained if the company cannot convert operating strength into sustainable net profits and returns on equity.

Negative/weak revenue growth

A negative revenue growth trend reduces scale benefits and pricing leverage in a business with significant fixed costs. Without durable top‑line stabilization via new contracts or market expansion, margin improvements may be vulnerable and long‑term profitability hard to sustain.

Customer concentration & regulatory exposure

Reliance on concentrated customers and access to regulated markets creates structural revenue and execution risk: loss of a major customer or facility compliance issues can sharply curtail sales and require ongoing capex for certifications, constraining predictable long‑term cash flows.

Solara Active Pharma Sciences Ltd. Business Overview & Revenue Model

Company Description

Solara Active Pharma Sciences Limited manufactures, produces, processes, formulates, sells, imports, exports, merchandises, distributes, trades in, and deals in active pharmaceutical ingredients (API) in India. The company offers APIs for anesthetics, anthelmintic, anti-arrhythmic agent, anti-asthmatic, anti-hypertensive, anti-inflammatory, anti-Parkinson, anti-viral, antibiotic, anticoagulant, anticonvulsant, antidepressant, antiemetic, antiepileptic, antifungal, antigout agent, antihistamine, antihyperlipoproteinemic, antimalarial, antimycotic, antineoplastic detoxifying agent, antiprotozoal agent, antipsoriatic, antipsychotic, antitubercular, antitussive, antiulcerative, anxiolytic, bile acid analogue, calcimimetic agent, cardiovascular agent, central nervous system agent, chronic alcoholism, chronic kidney disease, dopamine receptor antagonist, folate analog, hyperkalaemia, immunosuppressant, lipid regulating agent, loop diuretic, muscarinic agonist, neuromuscular, OAB treatment, phenylalanine reducer, recovery of stroke, tardive dyskinesia, treatment of glaucoma and hyperphosphatemia, tropical anti-infective, and type-II diabetes therapeutic categories. It also provides contract research and manufacturing services for APIs, including contract development and manufacturing, analytical services, impurity synthesis, and regulatory support. In addition, the company exports its products. It operates in the Asia Pacific, Europe, North America, South America, and internationally. The company was formerly known as SSL Pharma Sciences Limited and changed its name to Solara Active Pharma Sciences Limited in March 2017. Solara Active Pharma Sciences Limited was incorporated in 2017 and is based in Chennai, India.

How the Company Makes Money

Solara generates revenue through multiple streams including the sale of Active Pharmaceutical Ingredients (APIs) to pharmaceutical companies, contract manufacturing services, and exports to various international markets. The company's revenue model is driven by long-term contracts with clients, ensuring a steady flow of income. Additionally, SOLARA engages in partnerships and collaborations with other pharmaceutical firms, which enhance its product offerings and market reach. The company's focus on research and development helps it to innovate and expand its product portfolio, contributing to increased sales and market share.

Solara Active Pharma Sciences Ltd. Financial Statement Overview

Summary

Financials show mixed but improving quality: strong gross margin (51.2%) and a sharp rebound in EBIT margin (34.7%), plus materially stronger free cash flow growth (+155%). Offsetting this, net profitability is extremely weak (net margin ~0.04%) and ROE is very low (0.05%), indicating limited shareholder return despite operational recovery.

Income Statement

Solara Active Pharma Sciences Ltd. has demonstrated a volatile income trajectory reflected by fluctuating revenue and net income over the analyzed periods. The gross profit margin for the latest year is 51.2%, showing strong profitability in core operations, but the net profit margin is a mere 0.04%, indicating that high operational costs or other expenses significantly impact the bottom line. Revenue growth is relatively flat over the past year, with a minor increase of 0.76%. EBIT margin improved to 34.7% from negative figures in previous years, signifying operational recovery. Overall, the income statement reflects a mixed performance with potential stabilization in profitability.

Balance Sheet

The balance sheet of Solara Active Pharma Sciences Ltd. reveals a moderate financial position with a debt-to-equity ratio of 0.73, indicating a balanced approach to leveraging. The return on equity (ROE) is extremely low at 0.05%, suggesting inefficient utilization of equity to generate profits. The equity ratio stands at 49%, denoting a solid foundation of equity in the asset base. The company's reduction in debt and increase in equity over recent years are positive signs, but profitability remains a concern.

Cash Flow

The cash flow statement shows a strong improvement in free cash flow, which grew by 155% from the previous year, indicating enhanced cash generation capabilities. The operating cash flow to net income ratio is high, suggesting robust cash generation relative to net income, while the free cash flow to net income ratio also reflects healthy cash flows. These factors contribute to a positive cash flow outlook, signaling effective cash management despite past challenges.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	12.39B	12.84B	12.89B	14.27B	12.68B	15.97B
Gross Profit	5.90B	6.57B	-1.30B	1.25B	5.60B	3.81B
EBITDA	2.30B	2.06B	-2.82B	1.52B	793.30M	4.14B
Net Income	245.20M	5.40M	-5.67B	-221.70M	-581.50M	2.21B
Balance Sheet
Total Assets	0.00	22.32B	23.51B	28.99B	29.53B	26.14B
Cash, Cash Equivalents and Short-Term Investments	41.10M	41.10M	84.40M	87.30M	463.80M	1.98B
Total Debt	0.00	7.96B	10.12B	10.13B	10.37B	6.21B
Total Liabilities	-10.97B	11.35B	14.14B	13.97B	14.18B	10.21B
Stockholders Equity	10.97B	10.94B	9.34B	15.00B	15.25B	15.89B
Cash Flow
Free Cash Flow	0.00	1.73B	678.10M	449.40M	-4.51B	-190.20M
Operating Cash Flow	0.00	2.13B	1.09B	1.56B	-2.42B	1.55B
Investing Cash Flow	0.00	-368.30M	-35.10M	-811.40M	-2.43B	-1.06B
Financing Cash Flow	0.00	-1.80B	-1.06B	-1.13B	3.34B	924.90M

Solara Active Pharma Sciences Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 582.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SOLARA, the sentiment is Negative. The current price of 582.8 is above the 20-day moving average (MA) of 484.81, above the 50-day MA of 522.74, and above the 200-day MA of 573.90, indicating a bearish trend. The MACD of -16.80 indicates Positive momentum. The RSI at 33.79 is Neutral, neither overbought nor oversold. The STOCH value of 20.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:SOLARA.

Solara Active Pharma Sciences Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SMSPHARMA	65 Neutral	₹34.65B	38.62	―	0.13%	11.91%	36.92%
KRSNAA	62 Neutral	₹20.47B	25.53	―	0.38%	11.51%	21.56%
MOREPENLAB	57 Neutral	₹22.84B	24.12	―	0.49%	-0.29%	-29.04%
MEDIASSIST	56 Neutral	₹26.49B	46.86	―	0.92%	―	―
SOLARA	54 Neutral	₹22.27B	-108.71	―	―	-4.18%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
PANACEABIO	51 Neutral	₹20.07B	-257.99	―	―	9.78%	50.78%

Solara Active Pharma Sciences Ltd. Corporate Events

Solara Active Pharma Sciences Seeks Shareholder Nod to Appoint New Executive Director via Postal Ballot

Solara Active Pharma Sciences Ltd. has initiated a postal ballot process to seek shareholder approval for the appointment of Mohanraj Sanjeevi as a Whole-time (Executive) Director of the company. The postal ballot, conducted entirely through electronic means in line with regulatory circulars, runs e-voting from 5 February to 6 March 2026, with results expected by 10 March 2026, signaling a planned strengthening of the company’s executive leadership and corporate governance framework.

Solara Issues Second Reminder for First Call Payment on Rights Shares

Solara Active Pharma Sciences Ltd. has dispatched a second reminder notice to shareholders who have not yet paid the first call money on partly paid-up equity shares allotted under its ongoing rights issue. The company has sent these reminders electronically to registered email addresses and, where necessary, as physical copies, and has set 19 February 2026 as the last date for payment, after which compliant shareholders’ holdings will be updated for trading from partly paid-up shares of ₹3.50 to ₹7.00. This step is part of the company’s process to complete collection of the first call amount of ₹131.25 per partly paid-up rights share, and its execution signals continued progress in fully crystallising the rights issue proceeds, which is relevant for existing investors and market participants tracking Solara’s capital structure and funding plans.

Solara Active Pharma Sciences Addresses Surge in Trading Volume

Solara Active Pharma Sciences Limited has experienced a significant increase in the volume of its securities across exchanges. In response to an inquiry from the National Stock Exchange of India, the company clarified that it has complied with all disclosure regulations and has not withheld any material information that could affect its stock price or trading volume. This announcement aims to reassure investors and maintain transparency in the market.