Intraday Price Movement and Market Context
On the day, Bal Pharma Ltd’s stock touched an intraday low of Rs.64, representing a steep decline of 9.78% from previous levels. This drop contributed to an overall day change of -4.05%, underperforming its sector by 2.91%. The stock’s current price is substantially below its 52-week high of Rs.128.86, indicating a near 50% erosion in value over the past year.
The broader market context saw the Sensex open lower by 167.26 points and trade at 80,539.07, down 0.23%. Notably, other indices such as the S&P Bse FMCG and NIFTY FMCG also hit new 52-week lows on the same day, signalling sector-wide pressures. The Sensex itself is trading below its 50-day moving average, although the 50DMA remains above the 200DMA, suggesting mixed technical signals for the broader market.
Technical Indicators and Moving Averages
Bal Pharma’s share price currently sits above its 5-day moving average but remains below its 20-day, 50-day, 100-day, and 200-day moving averages. This pattern indicates short-term support but sustained weakness over medium to longer-term horizons. The stock’s inability to breach these key moving averages highlights persistent downward momentum.
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Financial Performance and Fundamental Metrics
Bal Pharma Ltd’s financial performance over the last year has been subdued, with the stock delivering a negative return of 40.29%, in stark contrast to the Sensex’s positive 3.90% gain over the same period. The company’s long-term growth has been modest, with net sales increasing at an annualised rate of 8.78% over the past five years.
Profitability metrics have deteriorated, with the company reporting negative results for four consecutive quarters. The Profit Before Tax (PBT) excluding other income for the latest quarter stood at a loss of Rs.0.40 crore, a decline of 125.64%. The half-year Return on Capital Employed (ROCE) is at a low 8.99%, reflecting limited efficiency in capital utilisation.
Debt servicing capacity remains a concern, with a high Debt to EBITDA ratio of 4.53 times and an operating profit to interest coverage ratio of just 1.48 times in the latest quarter. These figures suggest constrained financial flexibility and elevated leverage risks.
Long-Term and Recent Performance Trends
Bal Pharma’s underperformance extends beyond the last year. The stock has lagged the BSE500 index over the last three years, one year, and three months, indicating persistent challenges in generating shareholder value. The company’s Mojo Score stands at 14.0, with a Mojo Grade of Strong Sell as of 28 May 2025, an upgrade from the previous Sell rating. This grading reflects the company’s weak long-term fundamental strength and deteriorating financial health.
Despite these challenges, the company’s valuation metrics show some relative attractiveness. The ROCE of 7.8 and an enterprise value to capital employed ratio of 1.2 suggest the stock is trading at a discount compared to its peers’ historical averages. However, this valuation discount accompanies declining profits, which have fallen by 11% over the past year.
Shareholding and Sector Position
Promoters remain the majority shareholders of Bal Pharma Ltd, maintaining significant control over the company’s strategic direction. The stock operates within the Pharmaceuticals & Biotechnology sector, which has experienced mixed performance recently, with some indices also hitting 52-week lows.
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Summary of Key Metrics
To summarise, Bal Pharma Ltd’s stock has reached a new 52-week low of Rs.64, reflecting a significant decline from its peak of Rs.128.86. The company’s financial indicators reveal weak profitability, high leverage, and subdued growth rates. The Mojo Grade of Strong Sell underscores the challenges faced by the company in improving its fundamentals. While valuation metrics indicate some discount relative to peers, the ongoing decline in profits and negative quarterly results highlight the difficulties in reversing the current trend.
Market conditions, including a broadly negative Sensex and sectoral pressures, have compounded the stock’s downward trajectory. The stock’s technical positioning below key moving averages further emphasises the prevailing bearish sentiment.
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