Valuation Metrics and Recent Changes
As of the latest assessment, Lupin’s price-to-earnings (P/E) ratio stands at 20.20, reflecting a moderate valuation relative to its earnings. This is a slight increase from previous levels but remains within an attractive range when benchmarked against peers. The price-to-book value (P/BV) is currently 5.12, indicating investors are willing to pay a premium for Lupin’s net assets, consistent with its robust return on equity (ROE) of 22.03% and return on capital employed (ROCE) of 27.93%.
Enterprise value to EBITDA (EV/EBITDA) is at 13.13, which is competitive within the Pharmaceuticals & Biotechnology sector, suggesting efficient operational profitability relative to enterprise value. The PEG ratio, a key indicator of growth relative to valuation, remains impressively low at 0.28, signalling that Lupin’s earnings growth prospects are not fully priced in by the market.
Peer Comparison Highlights
When compared with its industry peers, Lupin’s valuation metrics present a balanced picture. For instance, Zydus Lifesciences also holds an attractive valuation with a P/E of 17.55 and EV/EBITDA of 11.63, but a significantly higher PEG ratio of 1.22, indicating less favourable growth valuation. Mankind Pharma, by contrast, is deemed expensive with a P/E of 45.5 and EV/EBITDA of 26.8, suggesting a stretched valuation relative to earnings and cash flow.
Other notable peers include Glenmark Pharma, which shares an attractive valuation with a P/E of 23.07 and EV/EBITDA of 12.55, and Biocon, rated very attractive but with a much higher P/E of 68.88 and EV/EBITDA of 20.47, reflecting different market expectations and growth profiles.
Stock Performance Versus Market Benchmarks
Lupin’s stock price closed at ₹2,199.20 on 16 Feb 2026, slightly down from the previous close of ₹2,210.20. The stock has traded within a 52-week range of ₹1,774.00 to ₹2,249.30, demonstrating resilience near its upper band. Intraday volatility ranged between ₹2,160.00 and ₹2,223.00, reflecting active trading interest.
Performance-wise, Lupin has outpaced the Sensex over multiple time horizons. Year-to-date, Lupin has gained 4.13% compared to a Sensex decline of 3.04%. Over one year, Lupin’s return of 6.98% trails the Sensex’s 8.52%, but the longer-term picture is more favourable. Over three years, Lupin has surged 225.76%, vastly outperforming the Sensex’s 36.73%. Similarly, over five years, Lupin’s return of 108.96% nearly doubles the Sensex’s 60.30% gain. The 10-year return of 25.60% is more modest but still notable given the sector’s cyclicality.
This week's revealed pick, a Large Cap from Public Banks with TARGET PRICE, is already showing movement! Get the complete analysis before it's too late.
- - Target price included
- - Early movement detected
- - Complete analysis ready
Mojo Score and Rating Upgrade
Lupin’s MarketsMOJO score has improved to 81.0, earning a Strong Buy grade as of 10 Feb 2026, upgraded from a Buy rating. This upgrade reflects enhanced confidence in Lupin’s fundamentals, valuation, and growth prospects. The market capitalisation grade remains at 2, indicating a sizeable but not overly large market cap relative to peers, which may offer room for further appreciation.
The strong ROCE and ROE figures underpin Lupin’s operational efficiency and shareholder value creation, supporting the upgraded rating. Dividend yield remains modest at 0.55%, consistent with the company’s reinvestment strategy in research and development and expansion initiatives.
Valuation Context and Investment Implications
The shift from very attractive to attractive valuation grade suggests that while Lupin’s shares have appreciated, they remain reasonably priced relative to earnings and growth potential. The P/E ratio of 20.20 is below many sector heavyweights, and the PEG ratio well below 1 indicates undervaluation relative to expected earnings growth.
Investors should note that Lupin’s valuation compares favourably against several peers deemed expensive, such as Abbott India and Laurus Labs, which trade at P/E multiples exceeding 35 and EV/EBITDA ratios above 30. This relative valuation advantage, combined with Lupin’s strong financial metrics, positions it as a compelling choice within the Pharmaceuticals & Biotechnology sector.
Risks and Considerations
Despite the positive outlook, investors should remain mindful of sector-specific risks including regulatory challenges, pricing pressures, and competition from generic manufacturers. Lupin’s moderate dividend yield may also deter income-focused investors. Additionally, the slight day decline of 0.50% on 16 Feb 2026 reflects short-term market volatility that could persist amid broader macroeconomic uncertainties.
Want to dive deeper on Lupin Ltd.? There's a real-time research report diving right into the fundamentals, valuations, peer comparison, financials, technicals and much more!
- - Real-time research report
- - Complete fundamental analysis
- - Peer comparison included
Conclusion
Lupin Ltd.’s recent valuation adjustment from very attractive to attractive reflects a maturing but still compelling investment opportunity. Its strong financial performance, favourable peer comparison, and upgraded MarketsMOJO rating to Strong Buy reinforce the stock’s appeal for investors seeking exposure to the Pharmaceuticals & Biotechnology sector. While short-term volatility and sector risks remain, Lupin’s robust fundamentals and reasonable valuation metrics suggest it is well positioned for sustained growth and value creation.
Investors should monitor Lupin’s evolving valuation parameters alongside sector dynamics to capitalise on potential upside while managing risk prudently.
Unlock special upgrade rates for a limited period. Start Saving Now →
