BALKRISIND - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 How I’m Thinking About This

You’re asking for a full-spectrum fundamental analysis of Balkrishna Industries Ltd (BALKRISIND), a leading player in off-highway tire manufacturing. I’m evaluating its financial strength, valuation metrics, business model, and technical indicators to determine its long-term investment potential and ideal entry point.

📊 Core Financials Breakdown

Profitability & Growth

EPS: ₹74.4 — solid earnings base

PAT Qtr: ₹287 Cr vs ₹362 Cr — -39.8% QoQ, indicating margin pressure

ROE: 15.5%, ROCE: 16.5% — respectable capital efficiency

Revenue CAGR (5Y): ~9.7% — steady but not explosive

1

Balance Sheet Strength

Debt-to-equity: 0.31 — conservative leverage

Book Value: ₹537 — price-to-book ratio ~4.66, premium valuation

Dividend Yield: 0.64% — modest, but consistent

💰 Valuation Indicators

Metric Value Interpretation

P/E Ratio 33.7 Fairly valued vs industry PE of 33.2

P/B Ratio ~4.66 Premium to book value

PEG Ratio 7.74 Overvalued relative to earnings growth

Intrinsic Value ~₹2,300–₹2,400 Slightly overvalued at current price

Valuation is elevated, especially with a high PEG ratio and recent earnings decline.

🏭 Business Model & Competitive Edge

Industry: Specialty tires — niche, export-driven

Moat: Strong global presence in agriculture, mining, and construction tires

Challenges

Input cost volatility

Weak demand in Europe and North America

FII outflow of -0.96% — signals cautious institutional sentiment

Despite recent headwinds, Balkrishna Industries maintains a durable brand and export advantage.

📉 Technical & Entry Zone

Current Price: ₹2,505

DMA 50/200: Hovering near both — neutral trend

MACD: -0.49 — mild bearish momentum

RSI: 61.7 — neutral to slightly bullish

📌 Suggested Entry Zone: ₹2,300–₹2,400

This range offers a better margin of safety and aligns with intrinsic value estimates.

🕰️ Long-Term Holding Guidance

Hold if already invested — fundamentals are stable

Buy on dips near ₹2,350 if bullish on global infrastructure and agri demand

2026 Target Price: ₹2,850–₹2,950 based on projected recovery and export growth

⭐ Fundamental Rating

3.7

1

simplywall.st

Edit in a page