Zenith Drugs (NSE:ZENITHDRUG) Interest Coverage : 10.37 (As of Mar. 2024)

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What is Zenith Drugs Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Zenith Drugs's Operating Income for the six months ended in Mar. 2024 was ₹64 Mil. Zenith Drugs's Interest Expense for the six months ended in Mar. 2024 was ₹-6 Mil. Zenith Drugs's interest coverage for the quarter that ended in Mar. 2024 was 10.37. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Zenith Drugs's Interest Coverage or its related term are showing as below:

NSE:ZENITHDRUG' s Interest Coverage Range Over the Past 10 Years
Min: 3.12 Med: 6.09 Max: 7.68
Current: 7.68

NSE:ZENITHDRUG's Interest Coverage is ranked worse than
59.69% of 655 companies
in the Drug Manufacturers industry
Industry Median: 12.05 vs NSE:ZENITHDRUG: 7.68

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Zenith Drugs Interest Coverage Historical Data

The historical data trend for Zenith Drugs's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Zenith Drugs Interest Coverage Chart

Zenith Drugs Annual Data

Trend

Mar21

Mar22

Mar23

Mar24

Interest Coverage

4.53

3.12

7.64

7.68

Zenith Drugs Semi-Annual Data
	Mar21	Mar22	Mar23	Sep23	Mar24
Interest Coverage	N/A	N/A	N/A	6.49	10.37

Competitive Comparison of Zenith Drugs's Interest Coverage

For the Drug Manufacturers - Specialty & Generic subindustry, Zenith Drugs's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Zenith Drugs's Interest Coverage Distribution in the Drug Manufacturers Industry

For the Drug Manufacturers industry and Healthcare sector, Zenith Drugs's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Zenith Drugs's Interest Coverage falls into.

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Zenith Drugs Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Zenith Drugs's Interest Coverage for the fiscal year that ended in Mar. 2024 is calculated as

Here, for the fiscal year that ended in Mar. 2024, Zenith Drugs's Interest Expense was ₹-20 Mil. Its Operating Income was ₹154 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹86 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Mar. 2024 )	/	Interest Expense (A: Mar. 2024 )
	=	-1	*	153.716	/	-20.009
	=	7.68

Zenith Drugs's Interest Coverage for the quarter that ended in Mar. 2024 is calculated as

Here, for the six months ended in Mar. 2024, Zenith Drugs's Interest Expense was ₹-6 Mil. Its Operating Income was ₹64 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹86 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Mar. 2024 )	/	Interest Expense (Q: Mar. 2024 )
	=	-1	*	63.788	/	-6.154
	=	10.37

The higher the ratio, the stronger the company's Financial Strength is.

Zenith Drugs (NSE:ZENITHDRUG) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Zenith Drugs Interest Coverage Related Terms

Thank you for viewing the detailed overview of Zenith Drugs's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Zenith Drugs Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Zenith Drugs Ltd (NSE:ZENITHDRUG) » Definitions » Interest Coverage

Traded in Other Exchanges

N/A

Address

K. No. 72 / 5, Village Muradpura, NA Depalpur, Indore, MP, IND, 453001

Website

https://www.zenithdrugs.com

Zenith Drugs Ltd is a pharmaceutical manufacturing and trading company. It offers a wide range of formulations in various forms such as ORS Powder, Liquid Orals, Ointments, Liquid Externals, and Capsules. It is also into Generic Medicines.

Zenith Drugs Headlines

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