Anuh Pharma Ltd Upgraded to 'Sell' as Technicals Improve Amidst Mixed Financials

Quality Assessment: A Mixed Picture Amidst Operational Challenges

In terms of quality, Anuh Pharma continues to face headwinds. The company’s financial performance in Q2 FY25-26 was notably weak, with Profit Before Tax (PBT) excluding other income falling sharply by 29.3% to ₹8.94 crores compared to the previous four-quarter average. Similarly, the Profit After Tax (PAT) for the latest six months declined by 35.19%, signalling deteriorating profitability. Return on Capital Employed (ROCE) for the half-year period stands at a modest 15.90%, the lowest in recent years, indicating less efficient capital utilisation.

Despite these setbacks, the company maintains a low debt-to-equity ratio averaging zero, which is a positive marker of financial prudence and risk management. Return on Equity (ROE) is at 11.8%, suggesting moderate shareholder returns. However, the long-term growth trajectory remains subdued, with net sales growing at an annualised rate of 13.69% and operating profit at just 7.18% over the past five years. These figures fall short of sector benchmarks, reflecting challenges in scaling operations profitably.

Valuation: Premium Pricing Amidst Profit Declines

Anuh Pharma’s valuation presents a complex scenario. The stock trades at a Price to Book Value (P/BV) of 2.5, which is a premium relative to its peers’ historical averages. This premium valuation is somewhat at odds with the company’s recent financial performance, particularly the 34.4% decline in profits over the past year. The market capitalisation grade stands at 4, indicating a mid-tier size within its sector.

While the company’s ROE of 11.8% supports a fair valuation, the premium pricing may reflect investor expectations of future turnaround or confidence driven by other factors such as promoter activity. It is important to note that the stock’s 52-week high was ₹120.68, whereas the current price is ₹80.66, indicating a significant correction from peak levels. This gap suggests that the market has already priced in some of the company’s challenges.

Financial Trend: Underperformance and Profitability Concerns

The financial trend for Anuh Pharma has been disappointing over the recent periods. The stock has underperformed the broader market significantly, with a one-year return of -25.61% compared to the BSE500’s positive 5.24% return. Year-to-date, the stock’s return is even more stark at -28.54%, while the Sensex has gained 8.39% over the same period.

Longer-term returns also paint a mixed picture. Over three years, Anuh Pharma has delivered an impressive 80.04% return, outperforming the Sensex’s 38.54%. However, over five and ten years, the stock has lagged, with returns of 16.02% and -3.72% respectively, compared to the Sensex’s 77.88% and 224.76%. This volatility and inconsistency in returns highlight the company’s cyclical challenges and sector-specific pressures.

Profitability metrics have also deteriorated, with the latest six-month PAT down by 35.19%. This decline, coupled with subdued sales growth and operating profit margins, signals caution for investors seeking stable earnings growth.

Technicals: Shift from Bearish to Mildly Bearish Signals

The upgrade in Anuh Pharma’s investment rating is largely driven by a subtle improvement in technical indicators. The technical grade has shifted from bearish to mildly bearish, reflecting a less negative momentum in the stock price movement. Key technical signals include:

• MACD: Weekly remains bearish, but monthly has improved to mildly bearish.


• RSI: Both weekly and monthly show no clear signal, indicating a neutral momentum.


• Bollinger Bands: Mildly bearish on both weekly and monthly charts, suggesting limited downside volatility.


• Moving Averages: Daily moving averages remain bearish, indicating short-term caution.


• KST (Know Sure Thing): Weekly is mildly bullish, while monthly remains mildly bearish, showing mixed momentum.


• Dow Theory: Weekly trend is mildly bullish, but monthly shows no definitive trend.


• On-Balance Volume (OBV): No clear trend on weekly or monthly charts, reflecting indecisive volume flows.

These technical nuances suggest that while the stock remains under pressure, the intensity of bearishness has eased, providing a rationale for the upgrade from Strong Sell to Sell. The stock price closed at ₹80.66 on 30 Dec 2025, up 0.44% from the previous close, with intraday highs reaching ₹81.93 and lows at ₹80.10. The 52-week trading range remains wide, between ₹74.03 and ₹120.68.

Promoter Confidence: A Silver Lining

One of the more encouraging developments for Anuh Pharma is the rising promoter confidence. Promoters have increased their stake by 1.9% over the previous quarter, now holding a commanding 71.82% of the company’s equity. This increased holding often signals management’s belief in the company’s long-term prospects and can be a stabilising factor amid market volatility.

While this does not immediately translate into improved financials or valuation, it provides a foundation for potential strategic initiatives or operational improvements that could benefit shareholders in the medium to long term.

Conclusion: A Cautious Upgrade Reflecting Technical Improvement Amid Financial Struggles

The upgrade of Anuh Pharma Ltd’s investment rating from Strong Sell to Sell is primarily driven by a modest improvement in technical indicators, signalling a reduction in bearish momentum. However, the company’s fundamental challenges remain significant, with negative quarterly financial results, underperformance relative to the market, and subdued long-term growth rates.

Valuation remains at a premium despite falling profits, and while promoter confidence is a positive sign, investors should remain cautious given the mixed signals from financial and technical analyses. The stock’s current Mojo Score of 31.0 and Mojo Grade of Sell reflect this balanced but cautious stance.

Investors considering Anuh Pharma should weigh these factors carefully, monitoring upcoming quarterly results and sector developments closely before making significant portfolio decisions.

Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year (MRP = Rs. 34,999) Start Today