CEATLTD - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 4.3

📈 Positive

• 📊 Strong earnings momentum with quarterly PAT up 48.1% to ₹202 Cr.
• 💹 Attractive PEG ratio of 0.30 indicates undervaluation relative to growth potential.
• 📈 EPS of ₹132 supports a solid earnings base and justifies current valuation.
• 📉 Trading above DMA50 and DMA200 (₹3,634 and ₹3,349), confirming bullish trend.
• 📈 MACD at 189 and RSI at 66.1 reflect strong upward momentum.

⚠️ Limitation

• 📉 Debt-to-equity ratio of 0.69 is moderately high, requiring monitoring of leverage levels.
• 📉 ROE (12.2%) and ROCE (15.8%) are decent but not industry-leading.
• 📉 Dividend yield of 0.73% is modest, offering limited passive income.
• 📉 Stock P/E of 28.9 is slightly below industry average (31.3), but still on the higher side.

📰 Company Negative News

• 📉 FII holding declined by 1.18%, indicating reduced foreign investor confidence.
• 📉 Stock near 52-week high (₹4,438), limiting immediate upside potential.

🌟 Company Positive News

• 📈 DII holding increased by 0.98%, showing strong domestic institutional support.
• 📈 Volume surge above 1-week average suggests rising investor interest.

🏭 Industry

• 🚗 CEAT operates in the tyre manufacturing sector, serving automotive OEMs and aftermarket demand.
• 📊 Industry P/E of 31.3 reflects moderate growth expectations and cyclical exposure to raw material costs.

🧭 Conclusion

• 📌 Suggested entry zone: ₹3,600–₹3,750, closer to DMA50 for better margin of safety.
• 🕰️ Long-term holding favorable due to strong earnings growth, improving margins, and technical strength.
• ⚖️ Monitor debt levels and global rubber prices as key risk factors.