AIIL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.2
| Stock Code | AIIL | Market Cap | 43,362 Cr. | Current Price | 511 ₹ | High / Low | 684 ₹ |
| Stock P/E | 12.0 | Book Value | 191 ₹ | Dividend Yield | 0.04 % | ROCE | 30.8 % |
| ROE | 34.1 % | Face Value | 1.00 ₹ | DMA 50 | 485 ₹ | DMA 200 | 503 ₹ |
| Chg in FII Hold | -0.22 % | Chg in DII Hold | 0.02 % | PAT Qtr | 168 Cr. | PAT Prev Qtr | 765 Cr. |
| RSI | 63.6 | MACD | 11.3 | Volume | 8,13,525 | Avg Vol 1Wk | 5,61,628 |
| Low price | 400 ₹ | High price | 684 ₹ | PEG Ratio | 0.14 | Debt to equity | 0.17 |
| 52w Index | 39.0 % | Qtr Profit Var | -69.2 % | EPS | 42.9 ₹ | Industry PE | 18.3 |
📊 Financial Overview: AIIL demonstrates strong return metrics with ROCE at 30.8% and ROE at 34.1%, supported by a manageable debt-to-equity ratio of 0.17. However, quarterly profit dropped sharply from ₹765 Cr. to ₹168 Cr. (-69.2%), raising concerns about earnings consistency. Cash flows remain stable due to moderate leverage, but profitability volatility is a limitation.
💹 Valuation Indicators: The stock trades at a P/E of 12.0 compared to the industry average of 18.3, suggesting undervaluation. With a book value of ₹191, the P/B ratio is ~2.7, which is reasonable. PEG ratio of 0.14 indicates strong growth potential relative to valuation. Intrinsic value appears higher than the current market price of ₹511, making it attractive for entry.
🏢 Business Model & Competitive Advantage: AIIL operates in the industrial sector, leveraging efficiency, scale, and diversified operations. Its competitive advantage lies in strong return metrics and operational efficiency, though earnings volatility weakens overall health.
📈 Entry Zone & Long-Term Guidance: Current price ₹511 is below intrinsic comfort levels. A favorable entry zone would be ₹480–₹500, aligning with DMA support. Long-term holding is advisable given strong ROCE/ROE and undervaluation, provided earnings stabilize.
Positive
- ✅ Strong ROCE (30.8%) and ROE (34.1%) indicate efficient capital use.
- ✅ P/E (12.0) below industry average (18.3), suggesting undervaluation.
- ✅ PEG ratio (0.14) signals attractive growth potential.
Limitation
- ⚠️ Quarterly profit dropped sharply (-69.2%).
- ⚠️ Dividend yield (0.04%) offers minimal investor income.
- ⚠️ Earnings volatility raises sustainability concerns.
Company Negative News
- 📉 PAT fell from ₹765 Cr. to ₹168 Cr. in the latest quarter.
- 📉 FII holding decreased by -0.22%, showing reduced foreign investor confidence.
Company Positive News
- 📈 DII holding increased by 0.02%, reflecting domestic support.
- 📈 RSI at 63.6 and MACD at 11.3 suggest bullish momentum.
Industry
- 🏭 Industry P/E at 18.3, higher than AIIL’s valuation, highlighting relative undervaluation.
- 🏭 Sector growth driven by industrial expansion and efficiency improvements.
Conclusion
🔎 AIIL is fundamentally strong with high ROCE/ROE and undervaluation relative to peers. Entry should be considered near ₹480–₹500. Long-term holding is favorable if earnings stabilize, making it a potentially rewarding investment.
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