⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.

AIIL - Fundamental Analysis: Financial Health & Valuation

Back to List

Rating: 3.6

Last Updated Time : 04 May 26, 11:57 am

Fundamental Rating: 3.6

Stock Code AIIL Market Cap 40,066 Cr. Current Price 472 ₹ High / Low 684 ₹
Stock P/E 11.0 Book Value 191 ₹ Dividend Yield 0.04 % ROCE 30.8 %
ROE 34.1 % Face Value 1.00 ₹ DMA 50 478 ₹ DMA 200 504 ₹
Chg in FII Hold -0.22 % Chg in DII Hold 0.02 % PAT Qtr 168 Cr. PAT Prev Qtr 765 Cr.
RSI 50.7 MACD 5.38 Volume 2,09,706 Avg Vol 1Wk 3,31,161
Low price 330 ₹ High price 684 ₹ PEG Ratio 0.13 Debt to equity 0.17
52w Index 40.1 % Qtr Profit Var -69.2 % EPS 42.9 ₹ Industry PE 18.2

📊 Financials: AIIL demonstrates strong efficiency with ROCE at 30.8% and ROE at 34.1%, supported by a low debt-to-equity ratio of 0.17. EPS stands at ₹42.9, providing a solid earnings base. However, quarterly PAT dropped sharply (-69.2%), indicating earnings volatility and weak cash flow stability.

💹 Valuation: The stock trades at a P/E of 11.0 compared to the industry average of 18.2, suggesting undervaluation. The PEG ratio of 0.13 highlights strong growth potential relative to valuation. Book value is ₹191, giving a P/B ratio of ~2.5, which is attractive compared to peers.

🏢 Business Model & Competitive Advantage: AIIL operates in a sector with stable demand, leveraging efficient capital use and strong profitability. Its competitive advantage lies in high return metrics and attractive valuation. However, sharp profit contraction raises concerns about sustainability.

🎯 Entry Zone: A favorable entry zone lies near ₹465–₹470 (support levels). Current price of ₹472 is close to this zone, offering a reasonable risk-reward setup.

📈 Long-Term Holding Guidance: Suitable for long-term investors given strong fundamentals and undervaluation. However, strict monitoring of earnings stability is essential. Partial allocation with profit booking near ₹500–₹510 is recommended.

Positive

  • Strong ROCE (30.8%) and ROE (34.1%)

  • Low debt-to-equity ratio (0.17)

  • EPS at ₹42.9 supports earnings visibility

  • Attractive P/E (11.0) vs industry average (18.2)

  • PEG ratio of 0.13 highlights undervaluation

Limitation

  • Quarterly PAT decline (-69.2%) shows earnings volatility

  • Dividend yield is negligible at 0.04%

  • Price below 200 DMA (₹504), limiting upside momentum

  • Trading volume weaker than 1-week average

Company Negative News

  • Sharp decline in quarterly profits (₹168 Cr. vs ₹765 Cr.)

  • Reduced foreign investor confidence (FII holdings -0.22%)

Company Positive News

  • Strong fundamentals with high ROCE/ROE

  • Domestic institutional inflows (+0.02%) provide minor support

  • Attractive valuation compared to peers

Industry

  • Industry P/E at 18.2 highlights sector trading at higher multiples

  • Sector outlook remains stable, but AIIL trades at discount valuation

Conclusion

⚖️ AIIL is fundamentally strong with high efficiency and undervaluation, but earnings volatility and weak volumes limit conviction. Entry near ₹465–₹470 offers favorable risk-reward, with exit around ₹500–₹510. Long-term holding is justified if earnings stabilize; otherwise, cautious partial exposure is recommended.

Back to List

NIFTY 50 - Fundamental Stock Watchlist

NEXT 50 - Fundamental Stock Watchlist

MIDCAP - Fundamental Stock Watchlist

SMALLCAP - Fundamental Stock Watchlist