CHOLAHLDNG - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.2
| Stock Code | CHOLAHLDNG | Market Cap | 29,220 Cr. | Current Price | 1,556 ₹ | High / Low | 2,299 ₹ |
| Stock P/E | 420 | Book Value | 72.2 ₹ | Dividend Yield | 0.08 % | ROCE | 6.26 % |
| ROE | 4.88 % | Face Value | 1.00 ₹ | DMA 50 | 1,577 ₹ | DMA 200 | 1,712 ₹ |
| Chg in FII Hold | -2.66 % | Chg in DII Hold | 2.54 % | PAT Qtr | 2.66 Cr. | PAT Prev Qtr | 27.2 Cr. |
| RSI | 50.6 | MACD | 9.63 | Volume | 1,31,262 | Avg Vol 1Wk | 2,33,944 |
| Low price | 1,305 ₹ | High price | 2,299 ₹ | PEG Ratio | 82.7 | Debt to equity | 0.00 |
| 52w Index | 25.3 % | Qtr Profit Var | 40.7 % | EPS | 3.70 ₹ | Industry PE | 25.5 |
📊 Financials: CHOLAHLDNG shows weak fundamentals with ROE at 4.88% and ROCE at 6.26%, reflecting poor efficiency. EPS of ₹3.70 is negligible, despite quarterly PAT growth from ₹27.2 Cr. to ₹2.66 Cr. (40.7% variation). Debt-to-equity at 0.00 highlights a debt-free balance sheet, but profitability remains unsustainably low.
💹 Valuation: The stock trades at a P/E of 420, far above the industry average of 25.5, indicating severe overvaluation. Book value of ₹72.2 results in a P/B of ~21.5, expensive relative to peers. PEG ratio of 82.7 further confirms unsustainable valuation. Intrinsic value appears significantly lower than current price, offering little margin of safety.
🏢 Business Model: CHOLAHLDNG operates as a holding company, but lacks strong profitability metrics. Its competitive advantage is limited, with weak efficiency ratios and negligible dividend yield (0.08%). Institutional sentiment is mixed, with FII holdings down (-2.66%) but DII holdings up (+2.54%).
🎯 Entry Zone: Safer entry only between ₹1,350–1,450, near support levels and below DMA averages. Long-term holding is not advisable unless ROE and ROCE improve substantially.
Positive
- Debt-free balance sheet (Debt-to-equity: 0.00).
- DII holdings increased (+2.54%), reflecting domestic institutional confidence.
- Quarterly PAT growth of 40.7% shows short-term improvement.
Limitation
- Extremely high P/E (420) vs industry average (25.5).
- ROCE (6.26%) and ROE (4.88%) are very weak.
- PEG ratio of 82.7 indicates severe overvaluation.
- Dividend yield negligible at 0.08%.
- FII holdings decreased (-2.66%), showing reduced foreign confidence.
Company Negative News
- Weak profitability metrics and declining foreign institutional interest raise sustainability concerns.
Company Positive News
- Debt-free status strengthens financial stability.
- DII holdings increased, showing domestic institutional support.
Industry
- Holding company sector trades at industry P/E of 25.5, much lower than CHOLAHLDNG’s valuation.
- Peers trade at moderate valuations, highlighting CHOLAHLDNG’s premium.
Conclusion
⚠️ CHOLAHLDNG is currently overvalued with weak fundamentals despite being debt-free. Entry near ₹1,350–1,450 offers safety for speculative investors, but long-term holding is not recommended unless profitability metrics improve significantly.