⚠ 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.
CEATLTD - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.2
| Stock Code | CEATLTD | Market Cap | 14,374 Cr. | Current Price | 3,554 ₹ | High / Low | 4,438 ₹ |
| Stock P/E | 20.4 | Book Value | 1,119 ₹ | Dividend Yield | 0.84 % | ROCE | 15.8 % |
| ROE | 12.2 % | Face Value | 10.0 ₹ | DMA 50 | 3,680 ₹ | DMA 200 | 3,607 ₹ |
| Chg in FII Hold | 0.71 % | Chg in DII Hold | -0.57 % | PAT Qtr | 235 Cr. | PAT Prev Qtr | 202 Cr. |
| RSI | 48.0 | MACD | -82.4 | Volume | 1,27,785 | Avg Vol 1Wk | 2,96,932 |
| Low price | 2,322 ₹ | High price | 4,438 ₹ | PEG Ratio | 0.21 | Debt to equity | 0.69 |
| 52w Index | 58.2 % | Qtr Profit Var | 145 % | EPS | 156 ₹ | Industry PE | 24.8 |
📊 Financial Overview
- Revenue & Profitability: Quarterly PAT rose from 202 Cr. to 235 Cr., showing strong growth momentum. EPS at 156 ₹ reflects solid earnings power.
- Margins & Returns: ROE at 12.2% is moderate, while ROCE at 15.8% indicates decent efficiency.
- Debt Profile: Debt-to-equity ratio of 0.69 is manageable, reflecting controlled leverage.
- Cash Flow: Consistent profitability supports healthy cash generation, with dividend yield at 0.84% adding shareholder value.
💹 Valuation Indicators
- P/E Ratio: 20.4 vs Industry PE of 24.8 → slightly undervalued relative to peers.
- P/B Ratio: Current Price 3,554 ₹ vs Book Value 1,119 ₹ → P/B ~3.17, reasonable for manufacturing sector.
- PEG Ratio: 0.21 → suggests attractive valuation given growth prospects.
- Intrinsic Value: Appears undervalued compared to industry benchmarks, offering entry potential.
🏢 Business Model & Competitive Advantage
- CEAT Ltd. is a leading tire manufacturer with strong presence in passenger, commercial, and specialty segments.
- Competitive advantage lies in brand recognition, diversified product portfolio, and distribution network.
- Operational efficiency and controlled leverage strengthen long-term sustainability.
📈 Technical & Entry Zone
- Stock trading at 3,554 ₹, below 50 DMA (3,680 ₹) and 200 DMA (3,607 ₹).
- RSI at 48.0 indicates neutral momentum; MACD negative suggests short-term weakness.
- Entry Zone: Attractive between 3,450–3,550 ₹ for accumulation, with long-term holding potential.
✅ Positive
- Strong EPS (156 ₹) and quarterly PAT growth.
- PEG ratio of 0.21 indicates undervaluation relative to growth.
- Controlled leverage with debt-to-equity at 0.69.
⚠️ Limitation
- ROE at 12.2% is moderate compared to industry leaders.
- Dividend yield at 0.84% is relatively low.
📉 Company Negative News
- No major recent negative news, but slight decline in DII holdings (-0.57%) reflects cautious sentiment.
📈 Company Positive News
- Quarterly PAT growth from 202 Cr. to 235 Cr. highlights operational strength.
- Increase in FII holdings (+0.71%) signals foreign institutional confidence.
🏭 Industry
- Tire industry benefits from rising automotive demand and infrastructure growth.
- Industry PE at 24.8 indicates sector growth potential.
- Competition from global and domestic tire manufacturers remains a challenge.
🔮 Conclusion
- CEATLTD shows strong fundamentals with undervaluation relative to peers and consistent profit growth.
- Moderate ROE and low dividend yield are limitations, but manageable given growth prospects.
- Recommendation: Accumulate in the 3,450–3,550 ₹ range for long-term holding, targeting growth aligned with automotive sector expansion.