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Natco Pharma Limited (NATCOPHARM) Fair Value & Analysis

Healthcare · IN · Market cap ₹167B

NP Natco Pharma Limited NATCOPHARM · NSE
Price₹889.80
Fair Value₹1,139
Upside+28.0%
Quality58/100
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Mixed Growth
Highly profitable · 34.8% net margin
Low debt · generates free cash flow
0.54% dividend yield
Ranks above peers (10/14)
Moderate moat 63/100
Evidence: High Range ₹846.76 – ₹1,847 Share as image

Fair value as of: Aug 13, 2026

From 26 valuation models · updated 4 days ago

Share price −5.8% over the past month.

A solid business, screening 28% undervalued on our models.

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What matters now

  • Solid quality (58/100) at a price below fair value, the discount is the argument here, not the business quality.
  • A fairly wide model range (₹846.76 to ₹1,847) leaves room in how you read the outcome.
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Price vs Fair Value (5 years)

₹1,579 ₹512.50 Fair Value ₹1,139 Apr 2021 Aug 2026

White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Aug 13, 2026.

How to read this chart

60‑month range ₹512.50 – ₹1,579 · fair‑value band ₹846.76 – ₹1,847 · the ₹889.80 price screens below the ₹1,139 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Aug 13, 2026.

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Analysis

Natco Pharma Limited (NATCOPHARM) currently trades at ₹889.80, while our model-based Fair Value estimate is ₹1,139, implying the stock looks roughly 28.0% undervalued today. The Quality Score stands at 58/100 (solid quality), in the Healthcare sector. Bull case: trading below our estimate, it may offer upside if the fundamentals hold. Bear case: a low price can be a value trap when quality is weak or the data is thin (evidence: high), always confirm before acting.

Over the trailing twelve months, Natco Pharma Limited generated revenue of ₹40.8B at a net margin of 34.8%. Revenue declined 39.6% year over year. It earns a return on equity of 16.9%. Net debt stands at ₹5.2B. Fundamentals as of Aug 13, 2026

Our scenario range runs from ₹846.76 (bear case) to ₹1,847 (bull case); at ₹889.80, the current price sits within that range. Bear and bull are the same models run on conservative and optimistic assumptions (margins, growth, valuation multiples), so a plausible valuation range, not a price target. Analysts expect earnings well below the last reported figure (earnings in transition, for example expiring patents or contracts); a fair value that looks fair on trailing earnings may then be too optimistic. The share trades about 27% below its 52-week high and 13% above its 52-week low, currently below its 200-day average. For context, the median of 10 Healthcare peers we cover trades at -49% fair-value upside, at 28%, NATCOPHARM screens cheaper than that median.

Fair Value models

Each model estimates fair value its own way; the Fair Value above is the evidence-weighted blend. Evidence (0–100) measures how completely this model’s inputs are available: well-fed models carry more weight in the blend. The spread across models is intentional, each one stresses a different value driver; dividend models, for instance, come out structurally low when payout is small.

Model Bear Bear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull Bull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. Evidence
Highest evidence
Growth DCF ₹1,019 ₹1,837 ₹3,260 80
Residual Income ₹527.61 ₹723.95 ₹2,510 76
Rev-Margin DCF ₹655.40 ₹1,083 ₹1,652 74
All 26 models by family
DCF Models
FCF DCF ₹1,033 ₹1,946 ₹3,593 38
Owner Earnings ₹926.38 ₹1,745 ₹3,220 31
5Y Revenue Exit ₹655.40 ₹1,088 ₹1,670 39
5Y EBITDA Exit ₹866.60 ₹1,535 ₹2,383 41
5Y P/E Exit ₹1,164 ₹2,165 ₹3,338 38
10Y Revenue Exit ₹755.24 ₹1,216 ₹1,919 36
10Y EBITDA Exit ₹913.73 ₹1,549 ₹2,532 37
10Y P/E Exit ₹1,113 ₹2,018 ₹3,352 35
Earnings-Based
Graham-Dodd ₹538.54 ₹2,729 ₹3,769 54
Lynch FV ₹741.21 ₹1,059 ₹1,377 50
PEG = 1.0 ₹741.21 ₹1,059 ₹1,377 46
EPV ₹594.10 ₹692.20 ₹778.03 59
Dividend Discount
Gordon GGM ₹46.24 ₹96.14 ₹152.52 70
DDM Multi-Stage ₹46.24 ₹81.07 ₹100.90 61
Multiples
P/E Multiple ₹1,307 ₹1,742 ₹2,178 63
P/S Multiple ₹597.71 ₹796.94 ₹996.18 58
P/B Multiple ₹1,010 ₹1,346 ₹1,683 55
EV/EBIT ₹881.03 ₹1,173 ₹1,465 53
EV/EBITDA ₹847.64 ₹1,128 ₹1,409 54
EV/Revenue ₹483.69 ₹688.62 ₹893.54 43
Asset-Based
NCAV (Graham) ₹257.41 ₹344.94 ₹514.83 50
Growth DCF
Growth DCF ₹1,019 ₹1,837 ₹3,260 80
Rev-Margin DCF ₹655.40 ₹1,083 ₹1,652 74
Economic Profit
Residual Income ₹527.61 ₹723.95 ₹2,510 76
ROIC Compounder ₹636.90 ₹882.74 ₹1,157 72
Growth Earnings
Growth-Adj P/E ₹1,152 ₹1,646 ₹2,139 68

Widest divergence: Growth Earnings (₹1,646) versus Dividend Discount (₹81.07). Highest evidence: Growth DCF (80).

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Key figures & financial health

Revenue (TTM) ₹40.8B
Revenue growth (YoY) -39.6%
Net margin 34.8%
Return on equity 16.9%
Free cash flow ₹13.8B FY2026
P/E ratio 11.2
More key figures
Operating margin 10.4%
EPS (TTM) ₹79.19
Dividend yield 0.5%
EPS growth (YoY) -34.1%
Net debt ₹5.2B FY2026

Figures from reported company fundamentals · as of Aug 13, 2026. TTM = trailing twelve months.

Quality Score breakdown

Overall quality 58/100

Of which business quality 61 · Market factors (momentum, volatility) 46

Profitability 62
Margins and returns on capital today
Quality Growth 9
Are margins and returns improving?
Cashflow 80
Earnings quality: real cash, not paper profit
Fin. Strength 80
Balance sheet, leverage, solvency risk
Investment 19
Disciplined investing over empire-building
Low Volatility 76
Calm price path (market factor)
Momentum 36
Price trend over the last 3–12 months (market factor)
52W Momentum 29
Distance to the 52-week high (market factor)
Net Issuance 85
Buybacks instead of dilution

Non-valuation factor families (profitability, growth, cashflow, financial strength, momentum …), each academically grounded. Valuation itself sits in the Fair Value and is deliberately excluded here to avoid double-counting.

About the company

NATCO Pharma Limited, a pharmaceutical company, engages in the research and development, manufacturing, and marketing of finished dosage formulations, active pharmaceutical ingredients (APIs), and intermediates in India, the United States, and internationally.

Full company description

NATCO Pharma Limited, a pharmaceutical company, engages in the research and development, manufacturing, and marketing of finished dosage formulations, active pharmaceutical ingredients (APIs), and intermediates in India, the United States, and internationally. The company offers formulations in various therapeutic areas, including cancers of blood, liver, kidney, lung, brain, breast, and ovary; and APIs in various categories, such as oncology, central nervous system, pain management, and cardiovascular care. It also provides orthopedic products comprising bisphosphonates, which are oral and injectable drugs; and gastroenterology products consisting of novel drugs for chronic hepatitis-B and hepatitis-C, as well as contract manufacturing services. In addition, the company offers neurology, cardiology and diabetology products for the treatment of hypertension, stable angina, and CHF. Further, the company provides agro chemicals and biological pest management solutions for management of insects, diseases, and weeds across a range of crops. NATCO Pharma Limited was incorporated in 1981 and is headquartered in Hyderabad, India.

Company description, as reported by the company or data provider.

Revenue & earnings trend

FY2022 – FY2026 · reported fiscal years

Natco Pharma Limited reported revenue of ₹40.8B in FY2026 versus ₹19.5B in FY2022, a compound +20.3%/yr. Reported net income was ₹14.2B in FY2026, compounding +70.0%/yr from FY2022.

Growth Quality 94/100
Revenue is growing, but margins or cash flow do not fully confirm the trend.
Latest Revenue (FY 2026)
₹40.8B
Latest YoY
−8.0%
Avg. growth/yr (3Y) Measures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+14.6%
Avg. growth/yr (5Y) Measures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+14.7%
Avg. growth/yr (21Y) Measures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+16.9%
Revenue +20.3%/yr
FY22 ₹19.5B
FY23 ₹27.1B
FY24 ₹40.0B
FY25 ₹44.3B
FY26 ₹40.8B
Net income +70.0%/yr
FY22 ₹1.7B
FY23 ₹7.2B
FY24 ₹13.9B
FY25 ₹18.9B
FY26 ₹14.2B
Character of growth · EPS growth decomposed (2015-2026) +21.4 % p.a.
Revenue per share +13.5 pp

of which total revenue +14.2 pp · buybacks/dilution −0.6 pp

EBIT margin +0.6 pp
Tax rate +0.6 pp
Residual (interest, one-offs) +6.6 pp

Absolute contributions in percentage points per year; they sum to the EPS growth rate. Start and end points are 3-year averages (details on hover).

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Cite: Fair Value Calculator (2026). "Natco Pharma Limited Fair Value". https://www.fairvalue-calculator.com/stock/NATCOPHARM

Peer Group

Drug Manufacturers - Specialty & Generic · 625 stocks

How this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.

Quality Score 58 · Above median
Fair Value upside +28% · Top 25%
Return on equity (TTM) 17% · Top 25%
Return on assets 8% · Top 25%
Net margin (TTM) 35% · Top 25%
Operating margin (TTM) 10% · Above median
Revenue growth -40% · Bottom 25%
Dividend yield (TTM) 0.5% · Bottom 25%
Debt / equity 0.01× · Lower than median

Valuation Multiples vs Drug Manufacturers - Specialty & Generic median · lower = cheaper

P/E (TTM) 11.2× · Cheaper than 75% of peers
P/B 1.82× · Pricier than median
P/S (TTM) 4.10× · Pricier than 75% of peers
P/FCF 0.1× · Cheaper than 75% of peers
EV/EBITDA 11.6× · Cheaper than median

Snowflake

Five quick dimensions, each 0 to 100: VALUE (fair-value potential), FUTURE (revenue growth), PAST (return on equity), HEALTH (low debt), DIVIDEND (yield). Green = this stock, grey = typical sector peer.

VALUE 71 · sector 7
FUTURE 0 · sector 20
PAST 67 · sector 24
HEALTH 99 · sector 96
DIVIDEND 11 · sector 32

Values & ESG

Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.

None of the checked exposures detected

ESG scores are not available for this stock yet. Values and ESG data are contextual and can differ between providers.

Similar stocks

10 more Drug Manufacturers - Specialty & Generic stocks, each showing price versus our Fair Value estimate (as of Aug 13, 2026).

Stock Price Fair Value vs Fair Value
Jiangsu Hengrui Pharmaceuticals Co 600276 ¥53.76 ¥25.94 -52%
Sun Pharmaceutical Industries Limited SUNPHARMA ₹1,944 ₹989.50 -49%
Divi's Laboratories Limited DIVISLAB ₹8,500 ₹1,932 -77%
Torrent Pharmaceuticals Limited TORNTPHARM ₹4,915 ₹1,163 -76%
PharmaEssentia Corporation 6446 1,440 TWD 233.93 TWD -84%
Cipla Limited CIPLA ₹1,463 ₹1,001 -32%
Zydus Lifesciences Limited ZYDUSLIFE ₹1,167 ₹703.32 -40%
Lupin Limited LUPIN ₹2,281 ₹2,477 +9%
Mankind Pharma Limited MANKIND ₹2,433 ₹983.11 -60%
Dr. Reddy's Laboratories Limited DRREDDY ₹1,200 ₹874.79 -27%

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Frequently asked questions

Is Natco Pharma Limited (NATCOPHARM) overvalued or undervalued?
As of Aug 13, 2026, our model estimates a fair value of ₹1,139 versus a price of ₹889.80, about +28% (undervalued).
What is the fair value of NATCOPHARM?
Our model-based fair value for Natco Pharma Limited is ₹1,139 (as of Aug 13, 2026), built from audited fundamentals. The current price is ₹889.80.
What is the quality score of NATCOPHARM?
Natco Pharma Limited has a Quality Score of 58/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the revenue of Natco Pharma Limited (NATCOPHARM)?
Natco Pharma Limited reported trailing-twelve-month revenue of about ₹40.8B (latest available figure, as of Aug 13, 2026).
What is the net profit margin of NATCOPHARM?
The net profit margin of Natco Pharma Limited is about 34.8%, meaning it keeps roughly 34.8% of revenue as net income. Based on the latest reported figures.
Does Natco Pharma Limited pay a dividend?
Natco Pharma Limited currently shows a dividend yield of about 0.54% relative to its recent price (as of Aug 13, 2026).

How we calculate Fair Value

Each company is valued through a stack of independent intrinsic-value models (DCF variants, residual-income, multiples and more), blended into one family-balanced consensus and weighted by how much trustworthy data backs it. A separate quality layer scores the fundamentals. Every input is real reported data, nothing guessed.

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