CHENNPETRO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.4
| Stock Code | CHENNPETRO | Market Cap | 16,802 Cr. | Current Price | 1,128 ₹ | High / Low | 1,160 ₹ |
| Stock P/E | 5.49 | Book Value | 725 ₹ | Dividend Yield | 0.71 % | ROCE | 35.6 % |
| ROE | 32.7 % | Face Value | 10.0 ₹ | DMA 50 | 988 ₹ | DMA 200 | 875 ₹ |
| Chg in FII Hold | -0.28 % | Chg in DII Hold | 1.09 % | PAT Qtr | 1,400 Cr. | PAT Prev Qtr | 987 Cr. |
| RSI | 62.8 | MACD | 33.1 | Volume | 45,10,501 | Avg Vol 1Wk | 56,83,309 |
| Low price | 585 ₹ | High price | 1,160 ₹ | PEG Ratio | -1.18 | Debt to equity | 0.18 |
| 52w Index | 94.6 % | Qtr Profit Var | 211 % | EPS | 206 ₹ | Industry PE | 15.7 |
📊 Financials: CHENNPETRO demonstrates excellent profitability with ROE at 32.7% and ROCE at 35.6%. EPS of ₹206 supports strong earnings visibility. Quarterly PAT surged from ₹987 Cr. to ₹1,400 Cr. (+211%), reflecting robust growth. Debt-to-equity at 0.18 highlights low leverage, strengthening financial stability.
💹 Valuation: The stock trades at a P/E of 5.49, far below the industry average of 15.7, indicating deep undervaluation. Book value of ₹725 gives a P/B of ~1.55, attractive relative to peers. PEG ratio of -1.18 suggests valuation misalignment with growth, requiring caution. Intrinsic value appears higher than current price, supporting accumulation.
🏢 Business Model: Operating in petrochemicals and refining, CHENNPETRO benefits from rising energy demand and government support. Its competitive advantage lies in strong profitability, low debt, and institutional confidence, with DII holdings up (+1.09%). However, reduced FII interest (-0.28%) signals cautious foreign sentiment.
🎯 Entry Zone: Attractive entry between ₹1,000–1,080, near DMA support levels. Long-term investors may hold for 3–5 years, with exit considerations if ROE falls below 25% or valuations stretch without earnings support.
Positive
- Low P/E (5.49) vs industry average (15.7).
- Strong ROCE (35.6%) and ROE (32.7%).
- Debt-to-equity ratio of 0.18 ensures financial stability.
- EPS of ₹206 supports strong earnings visibility.
- Quarterly PAT growth of 211% highlights operational strength.
- DII holdings increased (+1.09%), showing domestic confidence.
Limitation
- PEG ratio of -1.18 indicates valuation misalignment with growth.
- Dividend yield modest at 0.71%.
- FII holdings decreased (-0.28%), showing reduced foreign interest.
- High volatility in quarterly profits.
Company Negative News
- Reduced FII interest and negative PEG ratio highlight valuation concerns despite strong fundamentals.
Company Positive News
- Strong quarterly profit surge (+211%).
- Improved DII holdings (+1.09%).
- Low debt levels strengthen balance sheet.
Industry
- Petrochemical and refining sector benefits from rising energy demand and government support.
- Industry PE at 15.7 suggests CHENNPETRO trades at a discount.
Conclusion
✅ CHENNPETRO is a fundamentally strong company with excellent profitability, low debt, and attractive valuations. Entry near ₹1,000–1,080 offers safety, while holding for 3–5 years could yield strong returns if earnings growth sustains and institutional confidence stabilizes.