ATUL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | ATUL | Market Cap | 20,672 Cr. | Current Price | 7,019 ₹ | High / Low | 7,793 ₹ |
| Stock P/E | 34.7 | Book Value | 2,057 ₹ | Dividend Yield | 0.43 % | ROCE | 13.2 % |
| ROE | 10.3 % | Face Value | 10.0 ₹ | DMA 50 | 6,695 ₹ | DMA 200 | 6,439 ₹ |
| Chg in FII Hold | 0.05 % | Chg in DII Hold | 0.48 % | PAT Qtr | 204 Cr. | PAT Prev Qtr | 121 Cr. |
| RSI | 57.7 | MACD | 121 | Volume | 13,327 | Avg Vol 1Wk | 32,134 |
| Low price | 5,560 ₹ | High price | 7,793 ₹ | PEG Ratio | 23.0 | Debt to equity | 0.00 |
| 52w Index | 65.3 % | Qtr Profit Var | 62.2 % | EPS | 202 ₹ | Industry PE | 29.2 |
📊 Financial Overview: Atul shows moderate return metrics with ROCE at 13.2% and ROE at 10.3%. Debt-to-equity is 0.00, reflecting a debt-free balance sheet and strong cash flow stability. Quarterly profit surged from ₹121 Cr. to ₹204 Cr. (+62.2%), indicating robust earnings growth. However, margins remain modest relative to valuation multiples.
💹 Valuation Indicators: The stock trades at a P/E of 34.7 compared to the industry average of 29.2, suggesting slight overvaluation. With a book value of ₹2,057, the P/B ratio is ~3.4, which is reasonable. PEG ratio of 23.0 signals growth is not sufficient to justify the premium valuation. Intrinsic value appears slightly lower than the current market price of ₹7,019.
🏢 Business Model & Competitive Advantage: Atul operates in the specialty chemicals sector, leveraging diversified product lines, strong R&D, and established customer relationships. Its competitive advantage lies in innovation and niche market positioning, though global demand cycles can affect profitability.
📈 Entry Zone & Long-Term Guidance: Current price ₹7,019 is slightly above intrinsic comfort levels. A better entry zone would be closer to ₹6,400–₹6,600, aligning with DMA support. Long-term holding is advisable given debt-free status and earnings growth, but valuation should be monitored.
Positive
- ✅ Debt-free balance sheet (Debt-to-equity 0.00).
- ✅ Strong quarterly profit growth (+62.2%).
- ✅ Established brand in specialty chemicals with diversified portfolio.
Limitation
- ⚠️ P/E (34.7) slightly above industry average (29.2).
- ⚠️ PEG ratio (23.0) signals overvaluation relative to growth.
- ⚠️ Dividend yield (0.43%) remains modest.
Company Negative News
- 📉 Valuation multiples remain stretched compared to peers.
- 📉 Global demand cycles may impact earnings consistency.
Company Positive News
- 📈 FII holding increased by 0.05% and DII holding by 0.48%.
- 📈 RSI at 57.7 and MACD at 121 suggest bullish momentum.
Industry
- 🏭 Specialty chemicals industry P/E at 29.2, slightly lower than Atul’s valuation.
- 🏭 Sector growth driven by innovation, exports, and rising demand in pharma and agrochemicals.
Conclusion
🔎 Atul is financially strong with debt-free operations and robust profit growth. However, valuations are slightly stretched. Entry should be considered near ₹6,400–₹6,600. Long-term holding is favorable if earnings momentum continues and valuation moderates.
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