Key Events This Week
Feb 9: Stock opens strong at Rs.48.58, up 2.04%
Feb 10: Continued gains to Rs.49.59 (+2.08%) amid positive sentiment
Feb 11: Sharp reversal with a 2.44% drop to Rs.48.38
Feb 13: Q3 results reveal strong revenue growth but margin pressure; valuation shifts to fair
Strong Start on 9 February Reflects Early Optimism
Medico Remedies began the week on a positive note, closing at Rs.48.58 on 9 February, a gain of 2.04% from the previous close. This outpaced the Sensex’s 1.04% rise to 37,113.23, signalling early investor enthusiasm possibly driven by anticipation of upcoming quarterly disclosures. The volume was modest at 929 shares, indicating selective buying interest.
Momentum Builds on 10 February with Further Gains
The bullish momentum extended into 10 February, with the stock advancing another 2.08% to Rs.49.59, its weekly high. This performance again outstripped the Sensex’s 0.25% gain, closing at 37,207.34. Notably, volume surged to 13,154 shares, suggesting increased participation and confidence ahead of earnings. The stock’s appreciation during these two sessions marked a 4.15% rise from the prior Friday’s close, highlighting a strong early-week rally.
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Midweek Correction on 11 and 12 February
Following the early gains, the stock reversed course on 11 February, falling 2.44% to Rs.48.38 despite the Sensex’s marginal 0.13% rise. Volume moderated to 3,895 shares, indicating some profit-taking. The downward trend continued on 12 February, with the stock declining a further 1.51% to Rs.47.65, while the Sensex dropped 0.56%. This two-day correction erased much of the week’s initial gains and reflected growing caution ahead of the earnings announcement.
Q3 FY26 Results and Valuation Shift Impact 13 February Close
On 13 February, Medico Remedies reported a strong revenue surge for Q3 FY26, which was tempered by margin compression concerns. The stock closed at Rs.47.32, down 0.69% on the day and 0.61% for the week, underperforming the Sensex’s 1.40% decline. The results highlighted robust top-line growth but raised questions about profitability sustainability amid rising costs.
Simultaneously, the company’s valuation grade shifted from expensive to fair, with the Mojo Score settling at 58.0 and the grade downgraded to Hold. Key valuation metrics such as the P/E ratio at 34.66 and EV/EBITDA at 26.36 now align more closely with sector averages, reflecting a recalibration of market expectations amid sector volatility.
Despite respectable returns on capital employed (15.85%) and equity (16.98%), the stock’s recent price performance remains subdued, with a 6.25% year-to-date decline and a 31.43% drop over the past year. This contrasts with the Sensex’s more modest losses and gains over the same periods, underscoring sector-specific challenges.
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Daily Price Comparison: Medico Remedies Ltd vs Sensex
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-09 | Rs.48.58 | +2.04% | 37,113.23 | +1.04% |
| 2026-02-10 | Rs.49.59 | +2.08% | 37,207.34 | +0.25% |
| 2026-02-11 | Rs.48.38 | -2.44% | 37,256.72 | +0.13% |
| 2026-02-12 | Rs.47.65 | -1.51% | 37,049.40 | -0.56% |
| 2026-02-13 | Rs.47.32 | -0.69% | 36,532.48 | -1.40% |
Key Takeaways from the Week
Positive Signals: The early-week rally demonstrated underlying investor interest, supported by strong revenue growth in Q3 FY26. The company’s solid returns on capital employed and equity highlight operational efficiency and value creation despite sector headwinds.
Cautionary Notes: The subsequent price correction and the downgrade to a Hold rating reflect concerns over margin compression and valuation pressures. The stock’s year-to-date and one-year underperformance relative to the Sensex emphasise ongoing challenges in the pharmaceutical sector, including regulatory and pricing risks.
Medico Remedies’ valuation now aligns more closely with peers, suggesting a more balanced but cautious market stance. The stock remains well below its 52-week high of Rs.71.98, indicating significant price correction and volatility over the past year.
Conclusion
Medico Remedies Ltd’s week was characterised by an initial surge in price followed by a steady decline, culminating in a 0.61% weekly loss that slightly underperformed the Sensex. The company’s Q3 FY26 results revealed strong revenue growth but raised concerns about margin sustainability, which, combined with a valuation downgrade to Hold, tempered investor enthusiasm.
The shift from an expensive to a fair valuation grade reflects a recalibration of market expectations amid sector volatility. While the company’s operational metrics remain robust, the stock’s recent price performance and sector challenges warrant a cautious outlook. Investors should monitor upcoming developments closely to assess whether Medico Remedies can regain momentum and justify a re-rating in the near term.
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