Recent Price Movement and Market Context
On 21 Nov 2025, Godavari Drugs recorded an intraday low of Rs.77.01, down by 2.67% from its previous close. The stock’s intraday high was Rs.81.69, representing a 3.25% rise from the low point during the session. Despite this intraday volatility, the overall trend remained negative, with the stock underperforming its sector by 2.29% on the day.
The stock’s price currently trades below all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling sustained downward momentum. This contrasts with the broader market, where the Sensex opened lower by 285.28 points but remains close to its 52-week high of 85,801.70, trading at 85,307.27 as of the latest session. The Sensex is positioned above its 50-day and 200-day moving averages, indicating a generally bullish market environment.
Performance Over the Past Year
Godavari Drugs has experienced a notable decline over the last 12 months, with a total return of -32.09%. This contrasts sharply with the Sensex’s positive return of 10.57% over the same period. The stock’s 52-week high was Rs.133.90, highlighting the extent of the price contraction to the current low.
Over the past three years, the stock has also underperformed the BSE500 index across multiple time frames, including the last three years, one year, and three months. This persistent underperformance reflects ongoing challenges in the company’s financial and operational metrics.
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Financial Indicators and Recent Results
Godavari Drugs’ financial data over recent quarters reveals a subdued performance. The company has reported negative results for four consecutive quarters, with net sales for the nine-month period standing at Rs.75.96 crores, reflecting a decline of 21.64% compared to prior periods. Profit after tax (PAT) for the same period was Rs.2.93 crores, showing a contraction of 45.83%.
Operating cash flow for the year is reported at Rs.11.20 crores, the lowest level in recent times, indicating limited cash generation from core business activities. The company’s long-term net sales growth rate over the past five years shows a compound annual growth rate (CAGR) of -0.27%, underscoring a lack of expansion in revenue streams.
Debt and Valuation Metrics
One of the concerns for Godavari Drugs is its debt servicing capacity. The company’s Debt to EBITDA ratio stands at 3.27 times, suggesting a relatively high leverage position compared to earnings before interest, taxes, depreciation, and amortisation. This ratio indicates a moderate level of financial risk in meeting debt obligations.
On the valuation front, the company’s return on capital employed (ROCE) is 9.1%, which is modest but provides some indication of capital efficiency. The enterprise value to capital employed ratio is 1.2, suggesting that the stock is trading at a valuation discount relative to its capital base. This valuation is lower than the average historical valuations of its peers in the Pharmaceuticals & Biotechnology sector.
Shareholding and Market Position
Promoters hold the majority stake in Godavari Drugs, maintaining significant control over the company’s strategic direction. Despite the recent price weakness, the stock remains a part of the Pharmaceuticals & Biotechnology sector, which continues to be an important segment within the broader market.
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Summary of Key Challenges
The stock’s recent decline to Rs.77.01 marks a continuation of a downward trend that has been evident over the past year. The combination of subdued revenue growth, declining profits, limited cash flow generation, and elevated debt levels has contributed to the stock’s current valuation and price performance.
While the broader market indices maintain a positive stance, Godavari Drugs’ price action and financial metrics reflect a more cautious market assessment. The stock’s position below all major moving averages further emphasises the prevailing negative momentum in the short to medium term.
Comparative Market Environment
In contrast to Godavari Drugs, the Sensex is trading near its 52-week high and remains above key moving averages, signalling a generally positive market environment. This divergence highlights the stock-specific factors influencing Godavari Drugs’ performance relative to the broader market.
Investors analysing the Pharmaceuticals & Biotechnology sector may note that Godavari Drugs is trading at a discount compared to its peers’ historical valuations, reflecting the market’s current assessment of its financial and operational position.
Conclusion
Godavari Drugs’ fall to a 52-week low of Rs.77.01 underscores the challenges faced by the company in recent periods. The stock’s performance over the last year and its financial indicators point to a period of subdued growth and profitability. While the broader market environment remains relatively positive, the stock’s current valuation and price levels reflect a cautious stance by market participants.
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