CHAMBLFERT - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.5

📊 Core Financials

Earnings Strength: EPS of ₹43.5 and PAT of ₹638 Cr (up 15.5%) reflect strong profitability and consistent growth.

Return Metrics: ROCE at 27.6% and ROE at 20.3% are excellent, indicating efficient capital deployment and strong shareholder value creation.

Debt Profile: Debt-to-equity of 0.00 — completely debt-free, which enhances financial resilience and cash flow flexibility.

Cash Flow: While not explicitly stated, the combination of zero debt and strong earnings implies robust operating cash flows.

💰 Valuation Indicators

Metric Value Insight

P/E Ratio 12.6 Significantly undervalued vs. industry PE (30.1)

P/B Ratio ~2.57 Reasonable premium over book value

PEG Ratio 1.67 Fairly valued relative to growth

Dividend Yield 1.83% Attractive for income-focused investors

The valuation is compelling, especially given the strong earnings and zero debt.

🧪 Business Model & Competitive Advantage

Chambal Fertilisers & Chemicals Ltd. is a leading player in the urea and agri-inputs segment. Its strengths include

Large-scale production capacity and distribution network

Government subsidy support and strategic importance in food security

Operational efficiency and consistent dividend payouts

The company is considered a standard performer in terms of earnings and profit margins, and is listed among Nifty’s top dividend opportunities

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📈 Technical & Sentiment Indicators

RSI: 50.0 – Neutral zone, no strong momentum.

MACD: -0.45 – Mild bearish crossover, short-term weakness.

Volume Dip – Below weekly average, suggesting cooling interest.

DMA 50 & 200: Current price is hovering around both — consolidation zone.

💡 Investment Strategy

🔽 Entry Zone

Ideal Buy Range: ₹520–₹540, near support and slightly below DMA 50.

Current Price ₹548: Slightly above ideal entry, but still undervalued fundamentally.

🕰️ Long-Term Holding

Strong Hold or Accumulate: Debt-free, high ROE/ROCE, and attractive valuation make it a solid long-term compounder.

Monitor FII Trends: Recent FII outflow (-3.07%) may reflect short-term caution, but DII inflow (+1.98%) suggests domestic confidence.

You can explore a deeper analysis of Chambal Fertilisers or check its valuation breakdown and investor sentiment. Let me know if you'd like a peer comparison or a forecast model for FY27.

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