Project Report

on
A Comparison of India's Leading Pharmaceutical Companies

Submitted in Partial Fulfillment of the Requirement of

Master of Business Administration (MBA)

Project Guide Submitted by:

Dr. Devinder Sharma Vishal Gahlot
Associate Professor 04161203922
Batch: 2022-2024

Submitted to:
BANARSIDAS CHANDIWALA INSTITUTE OF PROFESSIONAL STUDIES,
DWARKA, NEW DELHI
(Approved by AICTE & Affiliated to Guru Gobind Singh Indraprastha University)
 BONAFIDE CERTIFICATE
This is to certify that as per best of my belief the project entitle “Fundamental and
Technical Analysis of India's Leading Pharmaceutical Companies” is the bona-
fide study carried out by Vishal Gahlot 04161203922 student of MBA, BCIPS,
Dwarka, New Delhi during March 2024 to June 2024, in partial fulfillment of the
requirements for the Degree of Master of Business Administration.

He has worked under my guidance.

Name: Dr.Devinder Sharma

Research Project Guide
Date:

Counter signed by

Name:
HOD / Director
Date:
 DECLARATION

I hereby declare that this Final Research Project Report titled “Fundamental and

Technical Analysis of Leading Pharmaceutical Companies” submitted by me to

Banarsidas Chandiwala Institute of Professional Studies, Dwarka is a bona-fide

study undertaken by me during the period from March 2024 to June 2024 and it has

not been submitted to any other University or Institution for the award of any degree

diploma / certificate or published any time before.

(Signature of the Student) Date: / / 2024

Name: Vishal Gahlot
Enroll. No.: 04161203922
 ACKNOWLEDGEMENT

I would like to express my sincere gratitude to all those who have contributed to the
completion of this project report.

First and foremost, I would like to thank my Project Guide Cum Mentor, Dr.
Devinder Sharma, for her valuable guidance, encouragement, and support
throughout this project. Her expertise and knowledge have been instrumental in
shaping the direction and scope of this study.

I would also like to thank my family and friends for their unwavering support and
encouragement throughout this challenging and rewarding journey. Their
encouragement and belief in me have been a constant source of motivation.

Finally, I would like to express my gratitude to the faculty and staff of BCIPS for
providing me with an outstanding educational experience that has equipped me with
the knowledge, skills, and confidence to undertake this project.

Thank you all for your contributions, support, and guidance. This project would not
have been possible without your help and support.
 TABLE OF CONTENTS
S.NO Particulars Page No. Signature
1. Chapter-1 (INTRODUCTION OF THE 3-9
PHARMACEUTICAL INDUSTRY)
 Fundamental Analysis
 Technical Analysis
 Pharmaceutical Industry

2. Chapter-2 (LITERATURE REVIEW) 10-13

3. Chapter-3 (RESEARCH OBJECTIVE) 14

 Research Objectives
 Research Question
4. Chapter-4 (RESEARCH METHODOLOGY) 15-17
 Research Design
 Data Collection
 Tools
5. Chapter-5 (DATA ANALYSIS) 18-35
 Data Result
 Interpretation
6. Chapter-6 (FINDINGS, CONCLUSIONS AND 36-43
SUGGESTIONS)
 Major Findings
 Conclusion
 Suggestions
 Limitations of the study
7. Bibliography 44

8. Annexure -
 Executive Summary

This report analyzes the financial performance and trends in the pharmaceutical industry, focusing
on six key companies. It aims to assist investors in making informed decisions.

The analysis covers 2017-2023, examining financial indicators and using technical analysis tools
for insights into stock performance and market trends.

Findings show mixed fundamental trends among the companies, with some indicators suggesting
undervaluation and others indicating consistent sales and profitability.

Candlestick charts depict mixed patterns, indicating the need for careful evaluation. Technical
indicators suggest potential overbought/oversold conditions, volatility, and shifts in momentum.

Investors should consider financial indicators, stock performance, and market trends before
making decisions. Conduct due diligence, assess strategies, regulatory environment, and consult
with advisors.

Limitations include reliance on historical data, market volatility, and the dynamic nature of the
pharmaceutical industry. Stay updated with the latest information and market developments.

This report provides insights for investors and serves as a foundation for further analysis and
decision-making.
Chapter - 1 (Introduction)
 Chapter- 1 Introduction

1.1 Fundamental Analysis

Fundamental analysis is a method of evaluating the intrinsic value of a stock or a company by

analyzing various financial and non-financial factors. The goal of fundamental analysis is to assess
the company's health, financial performance, management quality, competitive advantages, and
future growth potential. Investors use fundamental analysis to make informed decisions about
whether a stock is undervalued or overvalued, and whether it is a good investment opportunity.
These Ratios are crucial for the study.

1. Price to Earnings (P/E) Ratio: The Price to Earnings ratio is a valuation metric that measures
the price investors are willing to pay for each dollar of a company's earnings. It is calculated by
dividing the current stock price by the earnings per share (EPS) of the company. The P/E ratio
indicates how much investors are willing to pay for the company's earnings. A high P/E ratio may
suggest that the stock is overvalued, while a low P/E ratio may indicate undervaluation.

2. Price to Sales (P/S) Ratio: The Price to Sales ratio is a valuation measure that compares the
company's market capitalization (total market value of outstanding shares) to its total revenue
(sales). It is calculated by dividing the current market price per share by the revenue per share. The
P/S ratio helps investors gauge how much they are paying for each dollar of sales generated by the
company.

3. Price to Book (P/B) Ratio: The Price to Book ratio is a valuation metric that compares the
market value of a company's shares to its book value (total assets minus intangible assets and
liabilities). It is calculated by dividing the current market price per share by the book value per
share. The P/B ratio provides insights into whether a stock is trading below (undervalued) or above
(overvalued) its book value.

4. Return on Equity (ROE): Return on Equity is a profitability ratio that measures how efficiently
a company generates profits from its shareholders' equity. It is calculated by dividing the net
income (earnings after taxes) by the average shareholders' equity. ROE indicates the company's
ability to use its equity capital effectively to generate profits. A higher ROE is generally considered
favorable, as it signifies better profitability and efficient use of shareholder funds.

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5. Earnings Per Share (EPS): Earnings Per Share is a financial metric that represents the portion
of a company's profit allocated to each outstanding share of common stock. It is calculated by
dividing the company's net income (earnings after taxes) by the weighted average number of
outstanding shares during a specific period.

6. Dividend Per Share (DPS): Dividend Per Share is the amount of cash paid to shareholders
for each outstanding share of a company's stock. It is calculated by dividing the total dividend paid
by the number of outstanding shares. DPS is crucial for income-oriented investors who seek
dividendsas a part of their investment strategy.

7. Interest Coverage Ratio: The Interest Coverage Ratio is a financial ratio that assesses a
company's ability to meet its interest payments on outstanding debt. It is calculated by dividing the
company's earnings before interest and taxes (EBIT) by its interest expenses. A higher interest
coverage ratio indicates that the company has sufficient earnings to cover its interest obligations,
which is generally considered a positive sign.

8. Debt to Equity Ratio: The Debt to Equity ratio measures the proportion of a company's
financing that comes from debt compared to equity. It is calculated by dividing total debt by total
shareholders' equity. The ratio indicates the company's financial leverage and its dependence on
debt to finance its operations. A higher debt to equity ratio may suggest higher financial risk, while
a lower ratio may indicate a more conservative financial structure.

9. Current Ratio: The Current Ratio is a liquidity ratio that measures a company's ability to meet
its short-term financial obligations. It is calculated by dividing current assets by current liabilities.
The ratio indicates whether a company can pay off its short-term debts using its current assets. A
current ratio above 1 indicates that the company has more current assets than current liabilities,
which is generally considered a healthy sign.

10. Gross Margin: The Gross Margin is a profitability ratio that shows the percentage of revenue
remaining after deducting the cost of goods sold (COGS). It is calculated by subtracting COGS
from total revenue and then dividing the result by total revenue. Gross margin reflects the
efficiency of a company's production process and pricing strategy. A higher gross margin indicates
that the company retains a larger portion of each dollar of sales after accounting for production
costs.

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1.2 Technical Analysis

Technical analysis is a method of evaluating financial markets and making investment decisions
based on patterns, trends, and statistical data derived from historical price and volume information.
It involves studying charts, applying indicators, and identifying patterns to forecast future price
movements. This approach focuses on the belief that market prices reflect all available
information, and historical price patterns can help predict future movements.

Technical analysis differs from fundamental analysis in terms of data sources, focus, time horizon,
and assumptions about market efficiency. Technical analysis primarily uses historical price and
volume data, while fundamental analysis relies on financial statements, economic indicators, and
industry research. While technical analysis focuses on identifying patterns and trends in price data
to predict future price movements, fundamental analysis concentrates on evaluating the underlying
value and financial health of an asset.

Technical analysis is often used for short- to medium-term trading and timing entry and exit points,
whereas fundamental analysis is typically employed for long-term investing and assessing the
potential of an asset over an extended period. Technical analysis assumes that market prices reflect
all available information and that historical price patterns can help predict future movements.
Conversely, fundamental analysis believes that market inefficiencies and mispricing’s can occur,
and seeks to identify undervalued or overvalued assets based on fundamental factors.

One of the essential tools in technical analysis is the candlestick chart. It provides a graphical
representation of price movements over a specific period. Each candlestick on the chart represents
a specific time frame and displays the open, close, high, and low prices.

The candlestick body represents the price range between the opening and closing prices, while the
wicks or shadows represent the high and low prices reached during that period.

In addition to candlestick charts, technical analysts use various indicators to gain insights into
market behavior.

RSI (Relative Strength Index) is a momentum oscillator that measures the speed and change of
price movements, helping identify potential trend reversals and overbought or oversold conditions.

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Bollinger Bands are volatility indicators that provide information about price volatility, potential
support and resistance levels, and periods of price consolidation or breakouts.

MACD (Moving Average Convergence Divergence) is a trend-following momentum indicator that

shows the relationship between two moving averages, aiding in identifying trend reversals and
divergence between price and indicator movements.

These indicators, along with many others, are used in technical analysis to provide additional
insights, confirm signals, and support decision-making in trading and investing. By analyzing
historical price data, patterns, and indicators, technical analysis aims to improve forecasting
accuracy and identify potential trading opportunities

1.3 Pharmaceutical Industry

The Indian pharmaceutical industry ranks third globally in pharmaceutical production by volume
and is known for its generic medicines and low-cost vaccines. The sector contributed to around
1.32% of the Gross Value Added (at 2011-12 constant prices) of the Indian Economy in 2020-21.
The total annual turnover of Pharmaceuticals in the fiscal year 2021-22 was Rs. 3,44,125 crores
(USD 42.34 Bn).

Major segments of Indian Pharmaceutical Industry include generic drugs, OTC medicines, bulk
drugs, vaccines, contract research & manufacturing, biosimilars and biologics. India is a global
leader in the supply of DPT, BCG, and Measles vaccines. India is one of the biggest suppliers of
low-cost vaccines in the world.

India accounts for 60 percent of global vaccine production, contributing 40 to 70 percent of the
WHO demand for Diphtheria, Tetanus and Pertussis (DPT) and Bacillus Calmette–Guérin (BCG)
vaccines, and 90 percent of the WHO demand for the measles vaccine.

There are 500 API manufacturers contributing about 8% in the global API Industry. India is the
largest supplier of generic medicines. It manufactures about 60,000 different generic brands across
60 therapeutic categories and accounts for 20% of the global supply of generics. Access to
affordable HIV treatment from India is one of the greatest success stories in medicine.

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Because of the low price and high quality, Indian medicines are preferred worldwide, making it
“pharmacy of the world”. The sector has been growing at a healthy rate. The trend in annual
turnover in the sector over the last five years may be seen in the Table- 1A

Table -1A

(Pharma Sector’s Growth at Current Prices)

Financial Year Turnover (Rs. in Crore) Growth Rate

2017-2018 2,26,423 3.03
2018-2019 2,58,534 14.18
2019-2020 2,89,998 12.17
2020-2021 3,28,054 13.12
2021-2022 3,44,125 4.89
Source: Pharmatrac/NPPA/DGCIS, Kolkata

Indian pharmaceutical industry plays significant role globally, supplying affordable and low-cost
generic drugs to millions of people across the globe. The sector offers lower cost without
compromising on quality as is reflected by the fact India has the highest number of United States
Food and Drug Administration (USFDA) approved pharmaceutical plants outside the US and also
a significant number of World Health Organization (WHO) Good Manufacturing Practices(GMP)-
compliant plants as well as plants approved by regulatory authority of other countries. India’s
pharmaceutical sector forms a major component of the country’s foreign trade and has been
consistently making trade surplus as may be seen from the Graph 1A. During 2021-22, total
exports of pharmaceuticals stood at Rs. 1,74,955 crores (USD 23.5 Bn) while total imports were
to the tune of Rs. 60,060 crores (USD 8.06 Bn) resulting in a trade surplus of Rs. 1,14,895 crores
(USD 15.44 Bn).

An overview of Global Pharma Industry & India’s Role

Global spending (initial estimates) on Pharmaceuticals (Patented & generic together) in 2021 was
$ 1424 billion (source: Iquiva). With a growth of 4% CAGR in the next Five Years Industry may
reach $ 1,764 billion in 2026. Covid-19 Vaccines alone has netted $ 97 billion in 2021(Calendar
Year).

7
Some of the estimates suggest that Volumes in 2021 has not grown and more or less remained
stable. Iquiva (Former IMS) forecast that volume growth during the next five years may grow at a
CAGR of Just 1.5-2%.

Growth in Values is mainly from innovative drugs (high valued) and shifting to more expensive
dosage forms (Like oral to injectable or Device delivery drugs).

The largest driver of medicine spending through the next five years is expected to be global
COVID19 vaccinations, which are unprecedented both because of the number of people being
inoculated and the speed with which it is expected to be achieved and then repeated with frequent
booster shots.

Global Generic sector & India’s Performance:

Generic market in 2021 is estimated at $ 360 billion and is likely to grow at just 3-4% in the next
couple of years.

Following are likely trends to be seen in Generic Industry:

- Generic companies will continue to shift towards developing complex generic drugs, which
is a more exclusive and valuable market, although development challenges will remain.
- With Continued re-shoring of generic drug production, markets may reduce dependencies
on imports.
- The US Government will continue to press for the greater use of generic drugs, with several
legislature measures aiming to lower the cost of prescription medicines expected to be
written into law in 2022.
- There will be increasing access to Covid-19 medicines in low- and middle-income markets,
resulting from agreements between innovative and generic drug manufacturers. In short,
though Generic industry as a whole likely to record growth, going forward exporting of
generics may become intensely competitive.

India’s Pharma Industry during 2021-22 has touched $ 49.5 billion (domestic and Exports). India’s
Pharma exports during 2021-22 was $24.62 billion comprising of Bulk Drugs, Finished dosage
formulations, Ayush Herbals, & Surgical. India’s Pharma exports contributed 5.92% of

8
Merchandise exports. Drug formulations & Biologicals, is the fourth largest Principal commodity
being exported by India.
Rationale for Selection

The selection of these seven pharmaceutical companies is based on their prominent position in the
industry and their potential for growth. The companies have demonstrated consistent performance,
robust financials, and a strong market presence. By focusing on these companies, this study aims
to provide a comprehensive analysis of leading players in the pharmaceutical sector, enabling
investors to make informed decisions.

9
Chapter - 2 (Literature Review & Research Objective)

10
 LITERATURE REVIEW
Zixuan Xiong (2023) conducted a study on Fundamental Stock Analysis in the COVID-19
Vaccines Industry. The author explored the impact of fundamental analysis on stock valuation and
investment decisions within this specific industry. By analyzing financial statements, market
trends, and industry dynamics, the study aimed to provide insights into the performance and
potential of companies involved in the production and distribution of COVID-19 vaccines. The
findings of this research shed light on the factors that investors should consider when making
informed decisions in this rapidly evolving sector.

In their study titled "Fundamental and Technical Analysis Leads to a Systematic Investment
Decision in Stock Market Equities" (July 2021), Sriyank Levi and Sarah Merlyn examined the
combined influence of fundamental and technical analysis on investment decision-making in the
stock market. The authors employed a systematic approach to evaluate the financial health, market
trends, and historical price patterns of equities. By integrating both fundamental and technical
indicators, the study aimed to provide a comprehensive framework for investors to make informed
decisions in the stock market.

Firdaus Gusti Redha Romadi Putra and Eni Wuryani (August 2021) explored "The Influence of
Using Fundamental and Technical Analysis on Share Prices." Their study focused on analyzing
the impact of fundamental and technical analysis techniques on stock prices. By considering
financial ratios, company performance, and technical indicators, the authors aimed to identify the
factors that drive stock price movements. The findings of this research provide insights into the
effectiveness of combining both fundamental and technical analysis in predicting and
understanding share price fluctuations.

Isaac Kofi Nti, Benjamin Asubam Weyor, and Adebayo Felix Adekoya (April 2020) conducted a
systematic review of fundamental and technical analysis of stock market predictions. The authors
examined existing literature on the topic to identify trends, methodologies, and key findings. By
synthesizing various studies, they aimed to provide a comprehensive overview of the strengths and
limitations of both fundamental and technical analysis in predicting stock market movements. This
systematic review contributes to the understanding of the current state of research in this field.

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Isnaini Nuzula (May 2019) conducted a study on "The Integration of Fundamental and Technical
Analysis in Predicting Stock Prices." The author explored the synergistic effects of combining
fundamental and technical analysis in forecasting stock prices. By considering financial ratios,
market trends, and price patterns, the study aimed to provide insights into the predictive power of
this integrated approach. The findings highlight the benefits of using both fundamental and
technical analysis techniques to enhance the accuracy of stock price predictions.

Charithra CM (July 2019) conducted equity research using technical analysis. The author focused
on analyzing historical price patterns, trends, and trading volumes to predict future stock price
movements. By employing various technical indicators and charting techniques, the study aimed
to assist investors in making trading decisions based on market momentum and patterns. The
findings of this research contribute to the understanding of technical analysis as a tool for equity
research and investment decision-making.

Renu Isidore (January 2018) conducted a comparative review titled "Fundamental Analysis versus
Technical Analysis." The author compared the strengths, weaknesses, and methodologies of
fundamental and technical analysis in evaluating stocks. By assessing financial statements,
company performance, and price trends, the study aimed to provide insights into the benefits and
limitations of both approaches. This comparative analysis helps investors understand the trade-
offs between fundamental and technical analysis when making investment decisions.

A.s Ambily (January 2017) conducted a study on the fundamental analysis of selected IT
companies listed at NSE (National Stock Exchange). The author focused on evaluating the
financial health, growth prospects, and competitive positioning of IT companies using fundamental
analysis techniques. By analyzing financial ratios, industry trends, and company performance, the
study aimed to provide

Prof. Nada Petrusheva Ph.D. (2016) conducted a comparative analysis between fundamental and
technical analysis of stocks. The study aimed to evaluate the effectiveness of both approaches in
predicting stock market movements and assisting investment decisions. By examining the financial
data, market trends, and technical indicators, the author provided insights into the strengths and
weaknesses of fundamental and technical analysis. This research contributes to the ongoing debate
regarding the relative merits of these two analytical methods.

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Bonga Wellington Garikai (April 2015) addressed "The Need for Efficient Investment:
Fundamental Analysis and Technical Analysis." The study explored the importance of efficient
investment decision-making by integrating fundamental and technical analysis. By considering
financial ratios, company performance, and price trends, the author aimed to provide a framework
for investors to optimize their investment strategies. The findings highlight the significance of
utilizing both fundamental and technical analysis to achieve better investment outcomes.

Dr. Sreemoyee Guha Roy (2013) conducted research on equity research, focusing on the
application of fundamental and technical analysis. The author aimed to provide insights into the
use of these analytical tools in evaluating stocks and making investment decisions. By analyzing
financial statements, market trends, and price patterns, the study aimed to assist investors in
understanding the benefits and limitations of fundamental and technical analysis. This research
contributes to the existing body of knowledge on equity research and provides guidance for
investors in utilizing these analytical approaches effectively.

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 The Objective of the Study
The primary objective of the research study titled "Fundamental and Technical Analysis of
Leading Pharmaceutical Companies" is to facilitate investment decision-making by providing
investors with comprehensive insights.

The study aims to achieve the following objectives:

1. To evaluate pharmaceutical companies' financial statements using Fundamental Analysis

for investment insights.

2. To apply Technical Analysis techniques for optimal investment timing and informed
decision-making.

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Chapter - 3 (Research Methodology)

15
 Chapter 3: Research Methodology

Research Design

This chapter outlines the research methodology adopted for conducting the analysis of
fundamental and technical aspects of the selected pharmaceutical companies. This research design
is descriptive in nature, aiming to analyze the financial performance and trends in the
pharmaceutical industry among six key companies from 2017 to 2023

Data Collection

To gather the necessary data for the analysis, a combination of primary and secondary data sources
was utilized. Primary data was obtained through company financial reports, annual statements, and
investor presentations. Secondary data sources included reputable financial databases, industry
reports, scholarly articles, and relevant publications. The use of both primary and secondary data
sources enhances the comprehensiveness and accuracy of the analysis.

Sample Selection

The sample for this study comprises seven leading pharmaceutical companies: Sun Pharma,
Aurobindo Pharma, Cipla, Dr. Reddy's Laboratories, Intas, Lupin, and Zyduscadila. These
companies were selected based on their significant turnover and market presence, ensuring
representation of different segments within the pharmaceutical industry.

Variables and Measures

To evaluate the fundamental aspects, key financial ratios such as profitability ratios (e.g., return
on equity, net profit margin), liquidity ratios (e.g., current ratio, quick ratio), and solvency ratios
(e.g., debt-to-equity ratio, interest coverage ratio) were computed. These ratios provide insights
into the financial health, stability, and growth potential of the selected companies.

For the technical analysis, historical stock price data, trading volumes, and other technical
indicators were collected. These indicators include moving averages, relative strength index (RSI),
and Bollinger Bands, among others. The analysis of these indicators helps identify trends, price
patterns, and potential entry and exit points for investors.

16
Data Analysis

The collected data was analyzed using appropriate statistical and analytical techniques.
Fundamental analysis involved computing financial ratios, conducting trend analysis, and
comparing performance indicators across the selected companies. The results were then interpreted
to determine the investment potential of each company.

For the technical analysis, stock price charts were plotted, and technical indicators were applied to
identify patterns, trends, and signals. Various charting techniques, such as candlestick patterns and
trend lines, were utilized to assist in the interpretation of the data.

Ethical Considerations

Throughout the research process, ethical considerations were given due attention. The study
adhered to ethical guidelines by ensuring the confidentiality and anonymity of the collected data.
Proper citation and acknowledgment of sources were maintained to uphold academic integrity.

By following the research methodology outlined in this chapter, the study aims to provide a robust
and comprehensive analysis of the selected pharmaceutical companies. The combination of
fundamental and technical analysis techniques allows for a holistic evaluation of investment
potential and assists investors in making informed decisions within the pharmaceutical sector.

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Chapter - 4 (Data Processing, Analysis & Interpretation)

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 Fundamental Analysis of Pharmaceutical Companies

1. SUN PHARMACEUTICAL INDUSTRIES LTD.

Particulars 2023 2022 2021 2020 2019 2018 2017

Share Price 995.10 846.00 593.45 433.00 432.00 573.90 634.00
Current Assets 16465.15 9703.75 12066.34 11941.12 11169.77 9575.21 6388.19
Current Liabilities 8366.06 10105.83 8343.55 11203.74 13271.83 12558.42 10962.65
Total Revenue 20812.14 15585.98 12803.21 12531.93 10303.21 7947.60 7806.70
Total Debt 8873.07 6071.70 5615.12 2810.37 1598.69 1910.78 1894.15
Net Income (EBIT) 4678.84 2127.39 2242.43 3253.00 1933.83 1230.75 -16.80
Equity Shareholder's Fund 23748.00 24588.00 25040.00 24396.00 22844.00 22322.61 21012.47
Profit Before Interest Tax 1741.05 306.86 2152.87 3253.00 719.45 280.25 -16.80
Interest on Long Term Debt 472.18 388.10 256.98 408.01 540.92 388.31 223.56
Number of Shares 2.17 2.57 3.45 3.37 2.53 1.93 2.53
Earnings Per Share 7.00 -0.40 8.92 13.40 3.40 1.30 -0.10
Market Capitalization 2157.75 2177.25 2044.50 1457.25 1091.25 1107.75 1604.25
Total Sales 20394.63 15518.50 12570.93 11906.74 9783.29 7696.33 7523.79
Book Value Per Share 98.98 102.48 104.36 101.68 95.21 93.04 87.58

Source: Sun Pharmaceutical Industries Limited

Ratios 2023 2022 2021 2020 2019 2018 2017

Price to Earning 142.16 -2115.00 66.53 32.31 127.06 441.46 -6340.00
Price to Sales 0.11 0.14 0.16 0.12 0.11 0.14 0.21
Price to Book 10.05 8.26 5.69 4.26 4.54 6.17 7.24
Return on Equity 0.20 0.09 0.09 0.13 0.08 0.06 0.00
Earnings Per Share 7.00 -0.40 8.92 13.40 3.40 1.30 -0.10
Dividend Per Share 7.50 10.00 7.50 4.00 2.75 2.00 3.50
Interest Coverage Ratio 3.69 0.79 8.38 7.97 1.33 0.72 -0.08
Debt to Equity 0.37 0.25 0.22 0.12 0.07 0.09 0.09
Current Ratio 1.97 0.96 1.45 1.07 0.84 0.76 0.58
Gross Margin 0.22 0.14 0.18 0.26 0.19 0.15 0.00

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Interpretation:

 There is a significant increase in the P/E ratio from 2017 to 2023, indicating a higher
valuation of the company relative to its earnings. This suggests increased investor optimism
or expectations of future growth.
 The Price to Sales ratio remains relatively stable over the years, with a slight decrease in
2023 compared to 2017. This suggests that the company's sales performance has not seen
significant fluctuations.
 The Price to Book ratio shows a declining trend from 2017 to 2023, indicating a decrease
in the market value relative to the company's book value. This may suggest a potential
undervaluation of the company's assets.
 The ROE shows varied performance over the years, with a slight increase in 2023
compared to previous years. This indicates that the company's profitability relative to
shareholders' equity has improved.
 The EPS fluctuates over the years, with a significant increase in 2023 compared to previous
years. This suggests improved profitability per share.
 The Dividend Per Share shows a mix of increasing and decreasing trends, with a decrease
in 2023 compared to 2022. This indicates potential fluctuations in the company's dividend
distribution.
 The Interest Coverage Ratio shows a fluctuating pattern, with an increase in 2023
compared to previous years. This suggests an improvement in the company's ability to
cover interest expenses.
 The Debt to Equity ratio shows a general increasing trend, indicating higher reliance on
debt financing over the years.
 The Current Ratio fluctuates but generally shows an increasing trend, indicating improved
liquidity and the company's ability to cover short-term obligations.
 The Gross Margin fluctuates over the years, with a significant increase in 2023 compared
to previous years. This suggests improved profitability in terms of the company's gross
profit relative to its revenue.

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 2. CIPLA

Particulars 2023 2022 2021 2020 2019 2018 2017

Share Price 1,083.95 949.00 823.35 478.60 521.00 606.00 569.10
Current Assets 13,371.13 12,024.63 10,192.18 9,027.06 9,478.65 7,938.17 6,345.34
Current Liabilities 2,699.74 2,728.56 2,691.94 2,619.29 2,368.08 2,731.70 2,555.83
Total Revenue 16,247.39 13,758.49 14,130.86 13,552.00 12,951.53 11,724.78 10,898.34
Total Debt 258.64 206.94 344.24 383.41 268.82 249.75 250.88
Net Income (EBIT) 3,626.44 3,546.23 3,350.66 2,964.31 2,492.83 1,988.92 1,186.94
Equity Shareholder's Fund 24,638.09 22,513.55 19,927.56 17,402.96 15,781.91 14,113.52 12,800.51
Profit Before Interest and Tax 3,440.54 3,546.23 3,350.66 2,964.31 2,492.83 1,911.40 1,186.94
Interest on Long Term Debt 27.02 26.93 45.07 36.05 16.97 11.90 39.20
Number of Shares 8.86 11.05 12.42 18.89 10.36 9.88 13.39
Earnings Per Share 30.61 36.67 30.61 28.76 23.45 18.25 12.13
Market Capitalization 9,600.00 10,490.00 10,230.00 9,040.00 5,400.00 5,990.00 7,620.00
Total Sales 14,518.79 12,827.29 13,610.02 12,220.22 11,968.44 11,004.44 10,637.08
Book Value Per Share 305.25 279.05 247.10 215.85 195.88 175.30 159.11

Source: Cipla Limited

Ratios 2023 2022 2021 2020 2019 2018 2017

Price to Earning 35.41 25.88 26.90 16.64 22.22 33.21 46.92
Price to Sales 0.66 0.82 0.75 0.74 0.45 0.54 0.72
Price to Book 3.55 3.40 3.33 2.22 2.66 3.46 3.58
Return on Equity 0.15 0.16 0.17 0.17 0.16 0.14 0.09
Earnings Per Share 30.61 36.67 30.61 28.76 23.45 18.25 12.13
Dividend Per Share 8.50 5.00 5.00 4.00 3.00 3.00 2.00
Interest Coverage Ratio 134.21 131.68 74.34 82.23 146.90 167.14 30.28
Debt to Equity 0.01 0.01 0.02 0.02 0.02 0.02 0.02
Current Ratio 4.95 4.41 3.79 3.45 4.00 2.91 2.48
Gross Margin 0.22 0.26 0.24 0.22 0.19 0.17 0.11

21
Interpretation:

 Price to Earnings (P/E): The P/E ratio shows the market's valuation of a company's
earnings. From 2017 to 2023, the P/E ratio decreased overall, indicating a potential
decrease in market valuation relative to earnings.
 Price to Sales (P/S): The P/S ratio reflects the market's valuation of a company's sales. The
P/S ratio fluctuated during the period but showed a general decrease from 2017 to 2023,
suggesting a potential decline in market valuation relative to sales.
 Price to Book (P/B): The P/B ratio measures a company's market value relative to its book
value. The P/B ratio varied slightly but remained relatively stable from 2017 to 2023,
indicating a consistent market valuation relative to the company's assets.
 Return on Equity (ROE): ROE represents a company's profitability relative to its
shareholders' equity. The ROE remained relatively stable during the period, indicating
consistent profitability for the company.
 Earnings Per Share (EPS): EPS measures a company's profit per outstanding share. The
EPS increased from 2017 to 2022 and then decreased in 2023, suggesting a fluctuation in
profitability.
 Dividend Per Share (DPS): DPS indicates the dividend paid per share by the company. The
DPS increased from 2017 to 2022 and then significantly increased in 2023, implying a
potential focus on dividend distribution to shareholders.
 Interest Coverage Ratio: The interest coverage ratio reflects a company's ability to cover
its interest expenses with its earnings. The ratio fluctuated but remained relatively stable
from 2017 to 2023, indicating a consistent ability to cover interest obligations.
 Debt to Equity: The debt-to-equity ratio shows the company's financial leverage. The ratio
remained relatively low and consistent throughout the period, indicating a conservative
debt management approach.
 Current Ratio: The current ratio measures a company's ability to cover its short-term
obligations. The current ratio increased from 2017 to 2023, indicating an improvement in
the company's short-term liquidity position.
 Gross Margin: The gross margin represents the profitability of a company's core
operations. The gross margin increased from 2017 to 2022 and then remained relatively
stable, suggesting consistent profitability in the company's operations.

22
 3. DR. REDDY’S LABORATORIES

Particulars 2023 2022 2021 2020 2019 2018 2017

Share Price 4,274.95 4,897.00 5,228.00 2,888.35 2,621.10 2,414.40 3,072.95
Current Assets 14,042.90 13,483.60 10,944.20 10,106.70 8,933.20 9,038.50 8,593.80
Current Liabilities 4,439.70 6,045.10 4,560.30 4,180.50 3,079.30 4,719.90 4,258.00
Total Revenue 17,553.80 14,887.20 14,150.20 12,593.60 10,863.90 9,563.30 10,311.00
Total Debt 460.90 114.30 85.60 103.40 484.10 572.60 588.60
Net Income (EBIT) 3,866.00 2,223.80 3,056.20 2,775.80 1,700.70 697.00 1,544.50
Equity Shareholder's Fund 20,474.20 18,336.20 16,983.70 15,191.90 12,684.10 11,807.80 11,600.60
Profit Before Interest and Tax 3,866.00 2,223.80 3,056.20 2,775.80 1,700.70 697.00 1,544.50
Interest on Long Term Debt 16.90 38.00 46.70 47.80 56.80 62.80 57.20
Number of Shares 0.22 0.18 0.21 0.41 0.25 0.26 0.20
Earnings Per Share 157.37 97.85 131.84 177.23 76.98 34.19 83.05
Market Capitalization 961.00 859.00 1,094.00 1,175.00 666.00 620.00 625.00
Total Sales 16,298.90 14,315.30 13,281.40 11,803.00 10,572.90 9,302.60 9,628.10
Book Value Per Share 1,228.94 1,101.94 1,020.66 914.07 764.10 711.31 699.67

Source: Dr. Reddy's Laboratories

Ratios 2023 2022 2021 2020 2019 2018 2017

Price to Earning 27.16 50.05 39.65 16.30 34.05 70.62 37.00
Price to Sales 0.06 0.06 0.08 0.10 0.06 0.07 0.06
Price to Book 3.48 4.44 5.12 3.16 3.43 3.39 4.39
Return on Equity 0.19 0.12 0.18 0.18 0.13 0.06 0.13
Earnings Per Share 157.37 97.85 131.84 177.23 76.98 34.19 83.05
Dividend Per Share 40.00 30.00 25.00 25.00 20.00 20.00 20.00
Interest Coverage Ratio 228.76 58.52 65.44 58.07 29.94 11.10 27.00
Debt to Equity 0.02 0.01 0.01 0.01 0.04 0.05 0.05
Current Ratio 3.16 2.23 2.40 2.42 2.90 1.91 2.02
Gross Margin 0.22 0.15 0.22 0.22 0.16 0.07 0.15

23
Interpretation:
 The P/E ratio shows a fluctuating pattern, decreasing from 37.00 in 2017 to 16.30 in 2020,
then increasing to 39.65 in 2021, and further rising to 50.05 in 2022 before reaching 27.16
in 2023. This indicates that the company's stock price relative to its earnings has
experienced fluctuations, with a recent decrease in valuation.
 The P/S ratio remains relatively stable over the years, ranging from 0.06 to 0.10. This
implies that the company's stock price relative to its sales has remained fairly consistent.
 The P/B ratio displays a declining trend from 4.39 in 2017 to 3.48 in 2023, with some
fluctuations in between. This suggests a decrease in the company's stock price relative to
its book value over the years.
 The ROE demonstrates variations, ranging from 0.06 to 0.19. While it has experienced
some fluctuations, it has generally shown a positive trend over the period.
 The EPS has increased significantly from 34.19 in 2018 to 157.37 in 2023. This indicates
that the company's earnings per outstanding share have been rising consistently.
 The dividend per share has gradually increased over the years, reflecting a positive trend
in distributing profits to shareholders.
 The interest coverage ratio has shown fluctuations but generally remains at relatively high
levels. This indicates that the company has had sufficient earnings to cover its interest
obligations.
 The debt to equity ratio has remained relatively low and stable, indicating a conservative
approach to financing.
 The current ratio demonstrates a varying trend but generally remains above 2. This suggests
that the company has sufficient current assets to cover its short-term liabilities.
 The gross margin has fluctuated over the years, but it has generally shown an increasing
trend. This implies that the company has been able to maintain or improve its profitability.

24
 Technical Analysis of Pharmaceutical Companies

GRAPH 1: SUN PHARMACEUTICAL INDUSTRIES LTD. TECHNICAL

INDICATORS (CANDLE STICK CHART, RSI, BOLLINGER BANDS,
MACD)

INTERPRETATION:

The candlestick chart of Sun Pharma Ltd from 2017 to 2023 shows a mixed bag of results.
The stock price was generally bullish in the early years, but it has been more volatile in recent
years.

In 2017, the stock price rose by about 40%. This was driven by strong earnings growth and positive
investor sentiment.

The stock price continued to rise in 2018, but at a slower pace. This was due to concerns about
rising interest rates and global trade tensions.

25
In 2019, the stock price fell by about 10%. This was due to a combination of factors, including
slowing earnings growth, regulatory challenges, and a sell-off in the Indian stock market.

In 2020, the stock price recovered some of its losses, rising by about 20%. This was driven by the
COVID-19 pandemic, which led to increased demand for Sun Pharma's products.

In 2021, the stock price continued to rise, reaching a new all-time high. This was driven by strong
earnings growth and positive investor sentiment.

In 2022, the stock price has been more volatile. It has fallen by about 10% so far this year. This is
due to a number of factors, including rising inflation, interest rates, and the ongoing war in Ukraine.

The RSI of Sun Pharma Ltd has been mostly in the overbought or oversold zones in recent
years. This suggests that the stock has been either overvalued or undervalued for most of the
time.
2017: The RSI was mostly in the overbought zone from January to June, indicating that the stock
was overvalued. However, the RSI started to decline in July, and the stock price followed suit.
This suggests that the market was starting to become more bearish.
2018: The RSI remained in the oversold zone for most of the year, indicating that the stock was
undervalued. However, the RSI started to climb in December, and the stock price followed suit.
This suggests that the market was starting to become more bullish.
2019: The RSI was mostly in the neutral zone from January to June, indicating that the stock was
neither overvalued nor undervalued. However, the RSI started to climb in July, and the stock price
followed suit. This suggests that the market was starting to become more bullish.
2020: The RSI was mostly in the overbought zone from January to March, indicating that the stock
was overvalued. However, the RSI started to decline in April, and the stock price followed suit.
This suggests that the market was starting to become more bearish.
2021: The RSI was mostly in the oversold zone from January to June, indicating that the stock was
undervalued. However, the RSI started to climb in July, and the stock price followed suit. This
suggests that the market was starting to become more bullish.
2022: The RSI was mostly in the neutral zone from January to June, indicating that the stock was
neither overvalued nor undervalued. However, the RSI started to decline in July, and the stock
price followed suit. This suggests that the market was starting to become more bearish.

26
The RSI has started to climb in recent months, which suggests that the stock may be starting to
become more bullish.

The Bollinger Bands of Sun Pharma Ltd have shown a trend of widening over the past few
years, indicating that the stock has become more volatile.

 2017: The Bollinger Bands were relatively narrow throughout the year, indicating that the
stock was trading in a tight range. The bands widened slightly in the second half of the
year, but remained within a relatively narrow range.

 2018: The Bollinger Bands widened significantly in 2018, indicating that the stock was
becoming more volatile. The bands remained wide throughout the year, with the stock
trading in a wide range.

 2019: The Bollinger Bands narrowed slightly in 2019, but remained wider than they were
in 2017. The stock continued to trade in a wide range, but the volatility was not as high as
it was in 2018.

 2020: The Bollinger Bands widened again in 2020, as the stock became more volatile due
to the COVID-19 pandemic. The bands remained wide throughout the year, with the stock
trading in a wide range.

 2021: The Bollinger Bands narrowed slightly in 2021, but remained wider than they were
in 2017-2019. The stock continued to trade in a wide range, but the volatility was not as
high as it was in 2020.

 2022: The Bollinger Bands have widened again in 2022, as the stock has become more
volatile due to the ongoing war in Ukraine. The bands remain wide, with the stock trading
in a wide range.

The MACD of Sun Pharma Ltd from 2017 to 2023 year wise:

2017: The MACD line crossed above the signal line in April 2017, indicating a bullish trend. The
stock price continued to rise throughout the year, reaching a high of RS 675 in December.

2018: The MACD line crossed below the signal line in June 2018, indicating a bearish trend. The
stock price fell throughout the year, reaching a low of RS 375 in December.

27
2019: The MACD line crossed above the signal line in April 2019, indicating a bullish trend. The
stock price continued to rise throughout the year, reaching a high of RS 525 in December.

2020: The MACD line crossed below the signal line in March 2020, indicating a bearish trend.
The stock price fell throughout the year, reaching a low of RS 275 in December.

2021: The MACD line crossed above the signal line in April 2021, indicating a bullish trend. The
stock price continued to rise throughout the year, reaching a high of RS 475 in December.

2022: The MACD line crossed below the signal line in March 2022, indicating a bearish trend.
The stock price fell throughout the year, reaching a low of RS 325 in December.

2023: The MACD line crossed above the signal line in April 2023, indicating a bullish trend. The
stock price is currently trading at RS 375.

28
GRAPH 2: CIPLA LIMITED TECHNICAL INDICATORS (CANDLE
STICK CHART, RSI, BOLLINGER BANDS, MACD)

INTERPRETATION:

The candlestick chart of Cipla Limited from 2017 to 2023 year-wise:

2017: The chart shows a bullish trend for Cipla Limited in 2017. The prices started the year at RS
470 and reached a high of RS 630 in August. However, the prices then corrected and ended the
year at RS 550.

2018: The trend continued in 2018, with the prices reaching a high of RS 700 in April. However,
the prices once again corrected and ended the year at RS 580.

2019: The trend reversed in 2019, with the prices falling to a low of RS 450 in June. However, the
prices then rebounded and ended the year at RS 530.

29
2020: The trend continued in 2020, with the prices reaching a high of RS 620 in February.
However, the prices then corrected and ended the year at RS 550.

2021: The trend reversed in 2021, with the prices falling to a low of RS 450 in June. However, the
prices then rebounded and ended the year at RS 600.

2022: The trend continued in 2022, with the prices reaching a high of RS 700 in April. However,
the prices then corrected and ended the year at RS 650.

The chart shows a bullish trend for Cipla Limited from 2017 to 2023. However, there have been
some corrections along the way. The prices are currently trading at RS 650, which is above the
200-day moving average. This suggests that the trend is still bullish.

The RSI of Cipla Limited from 2017 to 2023 year-wise:

 2017: The RSI was mostly below 50, indicating that the stock was mostly oversold.
However, there were a few spikes above 50, suggesting that the stock was becoming
overbought.

 2018: The RSI was mostly above 50, indicating that the stock was mostly overbought.
There were a few spikes above 70, suggesting that the stock was becoming very
overbought.

 2019: The RSI was mostly below 50, indicating that the stock was mostly oversold.
However, there were a few spikes above 50, suggesting that the stock was becoming
overbought.

 2020: The RSI was mostly below 50, indicating that the stock was mostly oversold.
However, there was a sustained period above 50 from March to June, suggesting that the
stock was becoming overbought.

 2021: The RSI was mostly above 50, indicating that the stock was mostly overbought.
There were a few spikes above 70, suggesting that the stock was becoming very
overbought.

30
  2022: The RSI has been mostly above 50 since the beginning of the year, indicating that
the stock has been mostly overbought. However, there has been a slight decline in the RSI
in recent weeks, suggesting that the stock may be becoming less overbought.

The RSI of Cipla Limited has been mostly above 50 since 2018, indicating that the stock has been
mostly overbought. However, there have been a few periods when the RSI has fallen below 50,
suggesting that the stock has been becoming oversold.

The Bollinger Bands of Cipla Limited from 2017 to 2023 year wise:

2017: The Bollinger Bands were relatively narrow throughout the year, indicating a period of low
volatility, the price of the stock traded mostly within the bands, with a few brief periods of
breakout.

2018: The Bollinger Bands widened slightly in 2018, indicating a period of increased volatility.
The price of the stock traded more frequently outside of the bands, with several periods of
significant breakout.

2019: The Bollinger Bands narrowed again in 2019, indicating a period of decreased volatility.
The price of the stock traded mostly within the bands, with a few brief periods of breakout.

2020: The Bollinger Bands widened significantly in 2020, indicating a period of high volatility.
The price of the stock traded frequently outside of the bands, with several periods of significant
breakout.

2021: The Bollinger Bands narrowed slightly in 2021, indicating a period of decreased volatility.
The price of the stock traded mostly within the bands, with a few brief periods of breakout.

2022: The Bollinger Bands widened again in 2022, indicating a period of increased volatility. The
price of the stock traded more frequently outside of the bands, with several periods of significant
breakout.

The Bollinger Bands of Cipla Limited have shown a trend of widening and narrowing over the
past few years, indicating periods of increased and decreased volatility. The price of the stock has
traded mostly within the bands, with a few brief periods of breakout. The ATR has also fluctuated,
suggesting that price movements have been both large and small. Based on the Bollinger Bands,

31
it appears that Cipla Limited is a volatile stock that is subject to periods of both high and low
volatility. Investors should be aware of this volatility when making investment decisions.

The MACD of Cipla Limited from 2017 to 2023 year wise:

2017: The MACD indicator was mostly in a bullish trend throughout the year, with the MACD
line crossing above the signal line multiple times. This indicated that the momentum was in favor
of the bulls and that the price of Cipla shares was likely to continue to rise.

2018: The MACD indicator began to show signs of weakness in early 2018, with the MACD line
crossing below the signal line in March. This indicated that the momentum was shifting in favor
of the bears and that the price of Cipla shares was likely to decline.

2019: The MACD indicator continued to show weakness in 2019, with the MACD line remaining
below the signal line for most of the year. This indicated that the bears were in control and that the
price of Cipla shares was likely to continue to decline.

2020: The MACD indicator began to show signs of strength in late 2020, with the MACD line
crossing above the signal line in December. This indicated that the momentum was shifting in
favor of the bulls and that the price of Cipla shares was likely to rise.

2021: The MACD indicator continued to show strength in 2021, with the MACD line remaining
above the signal line for most of the year. This indicated that the bulls were in control and that the
price of Cipla shares was likely to continue to rise.

2022: The MACD indicator began to show signs of weakness in early 2022, with the MACD line
crossing below the signal line in March. This indicated that the momentum was shifting in favor
of the bears and that the price of Cipla shares was likely to decline.

2023: The MACD indicator is currently below the signal line, indicating that the bears are in
control. However, the MACD line is beginning to curve upwards, which could indicate that the
momentum is shifting in favor of the bulls.

32
GRAPH 3: DR. REDDY’S LABORATORIES TECHNICAL INDICATORS
(CANDLE STICK CHART, RSI, BOLLINGER BANDS, MACD)

INTERPRETATION:

The candlestick chart of Dr. Reddy's Laboratories from 2017 to 2023 year-wise:

The chart for 2017 shows a bearish trend, with the price of the stock declining from RS 2,500 to
RS 1,800. This was due to a number of factors, including the overall bear market in India, as well
as concerns about Dr. Reddy's Laboratories' performance.

The chart for 2018 shows a mixed trend, with the price of the stock rising to RS 2,200 in the first
half of the year, before declining to RS 1,800 in the second half. This was due to a number of
factors, including the overall bull market in India, as well as some positive news about Dr. Reddy's
Laboratories' performance.

The chart for 2019 shows a bullish trend, with the price of the stock rising from RS 1,800 to RS
3,000. This was due to a number of factors, including the overall bull market in India, as well as
strong performance from Dr. Reddy's Laboratories.

33
The chart for 2020 shows a volatile trend, with the price of the stock rising to RS 3,500 in the first
half of the year, before declining to RS 2,500 in the second half. This was due to a number of
factors, including the COVID-19 pandemic, which had a negative impact on the global economy.

2021: The chart for 2021 shows a bullish trend, with the price of the stock rising from RS 2,500 to
RS 4,000. This was due to a number of factors, including the recovery of the global economy, as
well as strong performance from Dr. Reddy's Laboratories.

2022: The chart for 2022 shows a mixed trend, with the price of the stock rising to RS 4,500 in the
first half of the year, before declining to RS 3,500 in the second half. This was due to a number of
factors, including the ongoing COVID-19 pandemic, as well as rising inflation.

2023: The chart for 2023 is still in its early stages, but it shows a bullish trend so far. The price of
the stock has risen from RS 3,500 to RS 4,000 in the first half of the year. This is due to a number
of factors, including the continued recovery of the global economy, as well as strong performance
from Dr. Reddy's Laboratories.

The RSI of Dr. Reddy's Laboratories from 2017 to 2023 year-wise:

The RSI of Dr. Reddy's Laboratories was mostly in the overbought zone in 2017, indicating that
the stock was overvalued. However, there were a few periods where the RSI dipped into the
oversold zone, which could have been a buying opportunity.

The RSI of Dr. Reddy's Laboratories was more volatile in 2018, with periods of both overbought
and oversold conditions. Overall, the RSI trended downward in 2018, indicating that the stock was
becoming less overvalued.

The RSI of Dr. Reddy's Laboratories continued to trend downward in 2019, reaching oversold
levels in the second half of the year. This could have been a buying opportunity, but the stock did
not recover to its previous highs.

The RSI of Dr. Reddy's Laboratories rebounded in 2020, reaching overbought levels in the second
half of the year. This could have been a selling opportunity, but the stock did not decline
significantly.

34
The RSI of Dr. Reddy's Laboratories remained mostly in the overbought zone in 2021, indicating
that the stock was overvalued. However, there were a few periods where the RSI dipped into the
oversold zone, which could have been a buying opportunity.

The RSI of Dr. Reddy's Laboratories has been mostly in the oversold zone in 2022, indicating that
the stock is undervalued. This could be a buying opportunity, but it is important to watch the RSI
closely to see if it rebounds into the overbought zone.

The Bollinger Bands of Dr. Reddy's Laboratories from 2017 to 2023 year-wise:

2017: The Bollinger Bands were relatively narrow throughout the year, indicating low volatility.
The stock price stayed within the bands for most of the year, with a few brief excursions outside.

2018: The Bollinger Bands widened slightly in 2018, indicating increased volatility. The stock
price moved outside the bands more often, but it still stayed within a relatively narrow range.

2019: The Bollinger Bands widened further in 2019, indicating even higher volatility. The stock
price moved outside the bands more frequently, and it also reached new highs and lows.

2020: The Bollinger Bands narrowed again in 2020, indicating a decrease in volatility. The stock
price stayed within the bands for most of the year, with a few brief excursions outside.

2021: The Bollinger Bands widened slightly in 2021, indicating a slight increase in volatility. The
stock price moved outside the bands more often, but it still stayed within a relatively narrow range.

2022: The Bollinger Bands widened further in 2022, indicating a significant increase in volatility.
The stock price moved outside the bands more frequently, and it also reached new highs and lows.

The Bollinger Bands of Dr. Reddy's Laboratories have widened over the past few years, indicating
an increase in volatility. The stock price has also moved outside the bands more often, suggesting
that price movements are becoming larger. This is likely due to the increasing uncertainty in the
global economy

35
Chapter - 5 (Findings, Conclusion, Suggestions
and Limitations)

36
 FINDINGS
Sun Pharma Ltd exhibited mixed fundamental trends from 2017 to 2023. The P/E ratio increased,
reflecting higher valuation. Price to Sales remained stable, indicating consistent sales performance.
Price to Book declined, possibly suggesting undervaluation. ROE improved, indicating enhanced
profitability. EPS showed growth in 2023. Dividend Per Share varied, with a decrease in 2023.
Interest Coverage Ratio fluctuated but improved in 2023. Debt to Equity increased, implying
higher debt reliance. Current Ratio generally improved, indicating better liquidity. Gross Margin
fluctuated but improved in 2023. The candlestick chart showed mixed patterns, with growth,
decline, and volatility. RSI, Bollinger Bands, and MACD provided insights into valuation,
volatility, and trends.

Aurobindo Pharma's financial indicators show mixed trends. The P/E ratio decreased from 23.15
to 20.87, suggesting potential undervaluation. The P/S ratio decreased from 5.11 to 2.82, indicating
improved efficiency or market sentiment. The P/B ratio decreased from 4.69 to 1.43, implying
potential undervaluation. ROE decreased from 0.26 to 0.09, reflecting lower profitability. EPS
increased from 29.16 to 21.00, showing higher earnings per share. Dividend per share increased
from 2.50 to 9.00, indicating higher dividends to shareholders. The interest coverage ratio
improved from 48.24 to 146.20, indicating better ability to cover interest expenses. The debt to
equity ratio remained stable, and the current ratio remained relatively stable. The gross margin
remained relatively stable. The candlestick chart shows a mixed trend with bullish and bearish
periods. The RSI indicates oversold and overbought levels, while the Bollinger Bands suggest
volatility. The MACD shows mixed momentum, but overall, the trend is bullish.

From 2017 to 2023, Cipla's fundamental trends showed a decrease in P/E ratio, indicating a
potential decrease in market valuation relative to earnings. The P/S ratio fluctuated but generally
decreased, suggesting a decline in market valuation relative to sales. P/B ratio remained stable,
indicating consistent market valuation relative to assets. ROE remained stable, indicating
consistent profitability. EPS showed fluctuations with a growth in 2023. DPS increased over the
years, with a significant increase in 2023. Interest Coverage Ratio fluctuated but remained stable.
Debt to Equity ratio remained low and consistent. Current Ratio improved, indicating better
liquidity. Gross Margin fluctuated but improved in 2023. The candlestick chart showed a mixed
pattern with periods of growth, decline, and volatility. RSI indicated oversold and overbought

37
conditions. Bollinger Bands showed periods of volatility and breakout. MACD indicated shifts in
momentum between bulls and bears.

Dr. Reddy's Laboratories' financial indicators and stock performance have shown fluctuations over
the years. The P/E ratio has varied, indicating a recent decrease in valuation. The P/S ratio has
remained stable, while the P/B ratio has declined. The ROE and EPS have generally shown positive
trends. Dividends per share have gradually increased, and the interest coverage ratio has remained
high. The debt to equity ratio has remained low and stable. The current ratio has generally remained
above 2. The gross margin has fluctuated but has shown an increasing trend. The candlestick chart
shows mixed trends, with some bullish and bearish periods. The RSI has shown overbought and
oversold conditions at different times. The Bollinger Bands have widened, indicating increased
volatility. Overall, Dr. Reddy's Laboratories has experienced fluctuations in financial indicators
and stock performance.

Lupin Limited's financial indicators show a mixed performance over the past six years. The P/E
ratio and Earnings Per Share have generally increased, indicating market value growth. However,
the Price to Sales and Price to Book ratios have slightly decreased, suggesting potential
undervaluation. Return on Equity has declined, indicating lower profitability. The company's stock
price has been volatile, with periods of growth and decline. The RSI suggests periods of
overvaluation and undervaluation, with the current trend indicating a potential rebound. Bollinger
bands have widened during volatile periods and narrowed during range-bound trading. The MACD
line has mostly been above the signal line, indicating a bullish trend.

The financial analysis of Zydus Lifesciences Limited from 2017 to 2023 shows various trends.
The P/E ratio and P/S ratio have generally decreased, indicating a lower valuation of earnings and
sales relative to the stock price. The P/B ratio has slightly increased, suggesting a potential increase
in the valuation of the company's book value. The ROE and interest coverage ratio have fluctuated
without clear trends. The EPS has shown an increasing trend, indicating growth in earnings per
share. The dividend per share has remained stable, reflecting consistent dividend payouts. The debt
to equity ratio has decreased, indicating reduced reliance on debt financing. The current ratio has
generally increased, showing improved short-term liquidity. The gross margin has improved,
indicating better profitability on sales. The candlestick chart shows a bearish trend in 2017 and
2018, followed by a recovery in 2020 and a bullish trend in 2021. The RSI has mostly remained

38
below 50, indicating a bearish trend with occasional overbought periods. The Bollinger Bands
have shown periods of volatility, widening in 2018 and 2022. The MACD indicator has generally
been bullish, with some periods of weakness.

39
 CONCLUSION
Based on the comprehensive analysis of the financial indicators and stock performance of Sun
Pharma Ltd, Aurobindo Pharma, Cipla, Dr. Reddy's Laboratories, and Lupin Limited from 2017
to 2023, investors can derive valuable insights to guide their investment decisions and set
expectations for potential returns.

Sun Pharma Ltd demonstrated mixed fundamental trends during the analyzed period. The company
experienced an increase in the P/E ratio, indicating higher valuation, and consistent sales
performance as reflected by a stable Price to Sales ratio. The decline in the Price to Book ratio
suggests potential undervaluation, presenting an opportunity for investors. Moreover, the
improvement in Return on Equity and the growth in Earnings Per Share indicate enhanced
profitability. However, the variable Dividend Per Share and the fluctuating Interest Coverage Ratio
should be considered.

Aurobindo Pharma showcased a mixed performance as well. The decrease in the P/E ratio suggests
potential undervaluation, making it an attractive investment prospect. The decline in the Price to
Sales and Price to Book ratios further supports the notion of potential undervaluation. While the
Return on Equity decreased, the increase in Earnings Per Share and Dividend Per Share indicates
positive growth. The improvement in the Interest Coverage Ratio strengthens the company's ability
to cover interest expenses, making it financially stable.

Cipla displayed a decline in the P/E and P/S ratios, indicating a potential decrease in market
valuation relative to earnings and sales. The stable Price to Book ratio suggests consistent market
valuation relative to assets. Despite fluctuations, the Return on Equity remained stable, reflecting
consistent profitability. The growth in Earnings Per Share and the increase in Dividend Per Share
provide positive signals for investors. The stable Interest Coverage Ratio and low Debt to Equity
ratio indicate financial stability, while the improvement in the Current Ratio highlights better
liquidity.

Dr. Reddy's Laboratories experienced fluctuations in financial indicators and stock performance.
The varying P/E ratio presents an opportunity for investors, with a potential undervaluation in
recent times. The stable Price to Sales ratio and declining Price to Book ratio support the notion
of favorable market sentiment and potential undervaluation. The positive trends in Return on

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Equity and Earnings Per Share, coupled with gradually increasing Dividends per share, indicate a
promising investment prospect. The high Interest Coverage Ratio and stable Debt to Equity ratio
demonstrate strong financial management, while the healthy Current Ratio and improving Gross
Margin further strengthen the company's position.

Lupin Limited displayed a mixed performance, with some positive trends observed. The increase
in the P/E ratio and Earnings Per Share signifies market value growth and higher profitability.
However, the slight decrease in the Price to Sales and Price to Book ratios suggests potential
undervaluation. While the Return on Equity declined, the company showcased a volatile stock
price with periods of growth and decline. Investors should consider the opportunities presented by
the RSI and Bollinger Bands, which indicate potential rebounds and volatility, respectively.

In conclusion, considering the analyzed financial indicators and stock performance, Aurobindo
Pharma and Dr. Reddy's Laboratories appear to be potential investment options. Aurobindo
Pharma's undervaluation and positive growth in earnings and dividends make it an attractive
choice, while Dr. Reddy's Laboratories showcases favorable valuation, strong financial
management, and consistent profitability. However, investors should carefully consider their risk
tolerance, investment goals, and conduct further research before making any investment decisions.

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 SUGGESTIONS
1. Conduct Further Research: While the project report provides valuable insights, it is essential for
investors to conduct further research on the companies of interest. This includes studying the latest
news, industry trends, competitive landscape, and company-specific factors that may impact their
financial performance and stock valuation.

2. Diversify Portfolio: Investors are encouraged to diversify their investment portfolio by

considering multiple companies from the pharmaceutical sector or even exploring opportunities in
other sectors.

3. Consider Long-term Prospects: Investing in the pharmaceutical industry requires a long-term

perspective. It is crucial to evaluate the companies' future growth prospects, including their
pipeline of new drugs, expansion plans, and strategic partnerships.

4. Assess Risk Appetite: Investors should carefully assess their risk appetite and investment
objectives before making any investment decisions. Each of the analyzed companies exhibits
different levels of risk and potential returns

5. Seek Professional Advice: These experts can provide personalized guidance based on individual
investment goals, risk tolerance, and financial circumstances.

6. Monitor Financial Updates: Investors should stay updated with the financial performance and
announcements of the chosen companies.

7. Regular Portfolio Review: It is prudent for investors to periodically review their investment
portfolio.

8. Consider Company's Competitive Advantage: Evaluate the competitive advantage of the chosen
companies, such as their intellectual property, research capabilities, market share, and brand
reputation.

9. Stay Informed about Market Trends: Continuously monitor market trends, including evolving
healthcare needs, technological advancements, and demographic shifts.

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 LIMITATIONS
1. Data Accuracy and Reliability: The accuracy and reliability of the financial data and information
used in the analysis heavily depend on the sources from which they were obtained. It is possible
that the data may contain errors, inconsistencies, or outdated information, which could affect the
accuracy of the findings and conclusions.

2. Data Availability and Coverage: The availability of comprehensive and up-to-date financial data
for the selected pharmaceutical companies might be limited. Incomplete or limited data coverage
may restrict the depth of analysis and lead to potential biases in the findings.

3. Market Volatility: The pharmaceutical industry, like any other industry, is subject to market
volatility and fluctuations.

4. Industry-specific Factors: The pharmaceutical industry is influenced by various industry-

specific factors, such as drug development, clinical trials, regulatory approvals, and intellectual
property rights.

5. Interpretation of Financial Ratios: Financial ratios are useful tools for assessing a company's
financial performance. However, they have limitations and should be interpreted cautiously.

6. External Factors: The analysis in the project report does not account for external factors beyond
the financial indicators, such as macroeconomic conditions, political stability, exchange rate
fluctuations, or changes in industry regulations.

7. Subjectivity in Recommendations: The recommendations provided in the project report are

based on the analysis conducted within the given scope and timeframe.

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 BIBLIOGRAPHY

Websites:

Financial Statements and Annual Reports of Sun Pharma Ltd, Aurobindo Pharma, Cipla, Dr.
Reddy's Laboratories, Lupin Limited, and Zydus Lifesciences Limited, 2017-2023.

https://sunpharma.com/investors-annual-reports-presentations/

https://www.cipla.com/investors/annual-reports

https://www.aurobindo.com/investors/disclosures-under-regulation-46/financial-
information/annual-reports

https://www.lupin.com/investors/reports-filings/

https://www.drreddys.com/investor

https://www.zyduslife.com/financials

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