CHAMBLFERT - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.2
| Stock Code | CHAMBLFERT | Market Cap | 17,284 Cr. | Current Price | 431 ₹ | High / Low | 742 ₹ |
| Stock P/E | 9.37 | Book Value | 241 ₹ | Dividend Yield | 2.32 % | ROCE | 27.6 % |
| ROE | 20.3 % | Face Value | 10.0 ₹ | DMA 50 | 453 ₹ | DMA 200 | 497 ₹ |
| Chg in FII Hold | -2.68 % | Chg in DII Hold | 0.65 % | PAT Qtr | 602 Cr. | PAT Prev Qtr | 638 Cr. |
| RSI | 41.3 | MACD | -6.12 | Volume | 16,56,975 | Avg Vol 1Wk | 10,69,033 |
| Low price | 410 ₹ | High price | 742 ₹ | PEG Ratio | 1.24 | Debt to equity | 0.00 |
| 52w Index | 6.39 % | Qtr Profit Var | 20.2 % | EPS | 46.0 ₹ | Industry PE | 18.4 |
📊 Financials: Chambal Fertilisers & Chemicals Ltd. has delivered strong profitability with PAT at 602 Cr compared to 638 Cr previously, reflecting resilience despite a slight sequential decline. ROE at 20.3% and ROCE at 27.6% highlight excellent efficiency. Debt-to-equity ratio of 0.00 indicates a debt-free balance sheet, strengthening financial stability. EPS of 46.0 ₹ supports earnings visibility, while quarterly profit variation of 20.2% shows healthy growth momentum.
💹 Valuation: Current P/E of 9.37 is significantly below the industry average (18.4), suggesting undervaluation. P/B ratio ~1.79 (Price 431 ₹ / Book Value 241 ₹) is reasonable. PEG ratio of 1.24 indicates fair valuation relative to growth. Dividend yield of 2.32% provides attractive income support for investors.
🏢 Business Model: Chambal Fertilisers operates in the agrochemicals and fertiliser sector, focusing on urea and allied products. Competitive advantage lies in scale, government support through subsidies, and strong distribution networks across rural India. The company benefits from recurring demand driven by agriculture cycles.
📈 Entry Zone: Attractive accumulation zone between 415–430 ₹, near support levels and below DMA200 (497 ₹). RSI at 41.3 indicates neutral momentum, while MACD (-6.12) suggests bearish undertone. Long-term investors can accumulate gradually at lower levels.
🔒 Holding Guidance: Fundamentally strong with debt-free operations, high ROE/ROCE, and undervaluation relative to peers. Suitable for long-term holding, though investors should monitor government policy changes and subsidy structures.
Positive
- Debt-free balance sheet enhances financial resilience.
- Strong ROE (20.3%) and ROCE (27.6%) highlight efficiency.
- Dividend yield of 2.32% provides attractive income support.
- P/E (9.37) significantly below industry average (18.4), indicating undervaluation.
Limitation
- Sequential PAT decline (602 Cr vs 638 Cr) shows short-term weakness.
- P/B ratio of 1.79 is fair but not deeply undervalued.
- FII holdings decreased (-2.68%), showing cautious foreign sentiment.
Company Negative News
- No major negative news reported, but reduced FII holdings and dependency on government subsidies raise caution.
Company Positive News
- Strong profit growth on a year-on-year basis.
- Debt-free operations strengthen balance sheet stability.
- DII holdings increased (+0.65%), reflecting domestic confidence.
Industry
- Fertiliser sector benefits from recurring agricultural demand and government support.
- Industry P/E at 18.4 suggests moderate optimism.
- Policy-driven sector with long-term demand stability tied to food security.
Conclusion
✅ Chambal Fertilisers & Chemicals Ltd. is financially strong, debt-free, and undervalued relative to peers. High ROE/ROCE and attractive dividend yield make it a promising long-term investment. Accumulation near 415–430 ₹ is recommended for patient investors, while monitoring government policy changes and subsidy structures.
I can also extend this with a peer comparison against Coromandel International and RCF to highlight relative valuation and efficiency. Would you like me to add that?