Looking to Invest in Indegene Ltd’s IPO? Evaluate These Financial Metrics

Key Highlights:

• Indegene Ltd's total income has grown from Rs 1,664.61 crores in FY 22 to Rs 2,306.13 crores in FY 23 in FY 23

• The company's PAT has risen to Rs 266.10 crores in FY 23 from Rs 164.76 crores in FY 22

• Its ROE has grown to 25.02% in FY 23 from 21.57% in FY 22

• The company's diluted EPS has grown to 11.97 in FY 23 from 7.46 in FY 22

Indegene Ltd, has launched an issue size of Rs 1841.76 crores within the price range of Rs 430-452, and generated considerable buzz among investors. Essential financial metrics are among the several aspects to evaluate before investing in a company's initial public offerng (IPO). If you plan to subscribe to an IPO, here are some financial metrices that deserve your attention.

Vital Financial Metrics to Evaluate

• Total income
  Total income refers to the company's aggregate money from all sources within a certain period. An increasing total income shows that a company generates more profit over time, which is a healthy sign. It shows a strong demand for the company's products and services with enhanced operational efficiency. Indegene Ltd's total income has steadily increased over the years. It grew from Rs 966.27 crores in FY 21 to Rs 1,664.61 crores in FY 22 and then rose to Rs 2,306.13 crores in FY 23.

• Profit after tax
  Profit after tax or PAT is a company's net profit after deducting all expenses, including taxes, from its total revenues. A rising PAT suggests that a company's revenue is growing at a healthy rate. It also reflects a company's strong competitive positioning within the industry and shows that the company's management is efficiently allocating resources to boost profits. Like total income, Indegene Ltd's PAT has witnessed a considerable rise over the years. It grew to Rs 266.10 crores in FY 23 from Rs 164.76 crores in FY 22.

• Return on Equity
  Return on Equity (ROE) shows how efficiently a company generates profits from its shareholders' equity. A high ROE shows that a company is prudent in using its shareholders' equity and is effectively using its resources to generate returns. A rising ROE also indicates that the company has the potential for future growth. This boosts investors' confidence and can enhance a company's stock value. Indegene Ltd has recorded a high ROE over the years. It stood at 25.02% in FY 23, rising from 21.57% in FY 22.

• Diluted Earnings Per Share A diluted earnings per share (EPS) shows a detailed view of a company's profitability. Employing numerous criteria in the calculation, a rising diluted EPS shows that a firm's earnings are on the rise on a per-share basis. It is a positive sign for investors as it suggests that a company generates higher returns relative to the number of outstanding shares. Indegene Ltd's diluted EPS has been on a growth trajectory, rising to 11.97 in FY 23 from 7.46 in FY 22 and 8.74 in FY 21.

Summing it up

These key financial indicators show Indegene Ltd’s solid financial position. They show that the company is financially well poised for growth and to capture market opportunities. That said, you must thoroughly evaluate the risks and consider your goals before subscribing to its IPO.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.

Investments in securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI prescribed Combined Risk Disclosure Document prior to investing. Brokerage will not exceed SEBI prescribed limit.

Source: RHP