Syngene International Ltd is Rated Sell

Current Rating and Its Implications for Investors

MarketsMOJO’s 'Sell' rating on Syngene International Ltd indicates a cautious stance towards the stock, suggesting that investors may want to consider reducing exposure or avoiding new purchases at this time. This rating reflects a comprehensive assessment of the company’s quality, valuation, financial trend, and technical indicators as they stand today. It is important to understand that a 'Sell' rating does not necessarily imply imminent losses but signals that the stock’s risk-reward profile is currently unfavourable compared to other investment opportunities.

Quality Assessment: Good but Not Compelling

As of 25 December 2025, Syngene International Ltd maintains a 'good' quality grade. This reflects a stable operational foundation and reasonable business fundamentals. The company has demonstrated moderate growth in net sales, with a compound annual growth rate of 12.63% over the past five years, and operating profit growth at 9.01% annually. However, recent quarterly results have shown signs of strain, with profit before tax (excluding other income) falling by 52.6% and net profit after tax declining by 47.1% compared to the previous four-quarter average. These figures highlight challenges in sustaining profitability momentum, which tempers the overall quality outlook.

Valuation: Very Expensive Relative to Peers

The valuation of Syngene International Ltd is currently assessed as 'very expensive'. The stock trades at a price-to-book value of 5.6, significantly higher than the average valuations of its healthcare services peers. Despite this premium, the company’s return on equity (ROE) stands at a modest 9.9%, which does not fully justify the elevated valuation. Additionally, the price-to-earnings-to-growth (PEG) ratio is an elevated 38.4, indicating that the market’s expectations for future growth are priced in at a high level. This expensive valuation reduces the margin of safety for investors and contributes to the cautious 'Sell' rating.

Financial Trend: Negative Momentum

The financial trend for Syngene International Ltd is currently negative. The latest quarterly results, as of 25 December 2025, reveal a significant decline in profitability metrics. Operating profit to interest coverage ratio has dropped to a low of 15.11 times, signalling increased financial pressure. Over the past year, the stock has delivered a negative return of -22.68%, underperforming the broader BSE500 index across multiple time frames including one year, three years, and three months. Although profits have inched up by 1.6% over the last year, this marginal improvement is insufficient to offset the broader downward trend in returns and investor sentiment.

Technical Outlook: Mildly Bearish Signals

From a technical perspective, Syngene International Ltd is graded as mildly bearish. The stock’s recent price movements show modest gains over short-term periods—1.36% over one week and 2.37% over one month—but these have not translated into sustained upward momentum. The one-day change on 25 December 2025 was a decline of 0.52%, reflecting ongoing volatility. The mildly bearish technical grade suggests that the stock may face resistance in breaking out of its current trading range, and investors should be cautious about timing new entries.

Performance Summary and Market Position

Syngene International Ltd is classified as a small-cap company within the healthcare services sector. Despite its sector’s generally defensive characteristics, the company’s performance has been below par in both the long and near term. The stock’s subdued growth rates, combined with negative recent earnings trends and a stretched valuation, have contributed to its current 'Sell' rating. Investors should weigh these factors carefully against their portfolio objectives and risk tolerance.

What This Means for Investors

Investors considering Syngene International Ltd should recognise that the 'Sell' rating reflects a comprehensive evaluation of the company’s current challenges and market positioning. The combination of a very expensive valuation, negative financial trends, and mildly bearish technical signals suggests limited upside potential in the near term. While the company’s quality remains good, the recent deterioration in profitability and underperformance relative to benchmarks warrant caution.

For those holding the stock, it may be prudent to reassess exposure and consider risk management strategies. Prospective investors might prefer to monitor the company for signs of financial recovery or valuation correction before initiating new positions. Diversification into more favourably rated healthcare services stocks or other sectors could offer better risk-adjusted returns at this juncture.

Summary of Key Metrics as of 25 December 2025

• Mojo Score: 34.0 (Sell Grade)


• Market Capitalisation: Small Cap


• Net Sales Growth (5 years CAGR): 12.63%


• Operating Profit Growth (5 years CAGR): 9.01%


• Return on Equity (ROE): 9.9%


• Price to Book Value: 5.6


• PEG Ratio: 38.4


• Stock Returns: 1 Year -22.68%, YTD -23.72%


• Operating Profit to Interest Coverage (Quarterly): 15.11 times

These figures collectively underpin the current 'Sell' rating and provide a data-driven foundation for investment decisions.

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