COROMANDEL - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.3

📊 Core Financials

Earnings Strength: EPS of ₹71.9 and PAT of ₹508 Cr (up 53.6% QoQ) reflect strong profitability and growth momentum.

Return Metrics: ROCE at 24.6% and ROE at 17.5% are solid, indicating efficient capital deployment and shareholder value creation.

Debt Profile: Debt-to-equity of 0.05 — virtually debt-free, which enhances financial stability and cash flow flexibility.

Cash Flow: Implied to be robust given consistent earnings and low leverage.

💰 Valuation Indicators

Metric Value Insight

P/E Ratio 33.2 Slightly above industry PE (30.1), but reasonable for quality

P/B Ratio ~6.18 Premium valuation over book value

PEG Ratio 4.17 Overvalued relative to growth

Dividend Yield 0.52% Modest, not a major income play

Valuation is elevated, but supported by strong fundamentals and growth trajectory.

🌾 Business Model & Competitive Advantage

Coromandel International Ltd. is a leading agrochemical and fertilizer company under the Murugappa Group. Key strengths include

Diversified portfolio across crop protection, specialty nutrients, and organic fertilizers

Strong rural distribution network and brand equity

Strategic backward integration and R&D capabilities

Beneficiary of government subsidy flows and rising agri-input demand

Over the past five years, the stock has delivered a 196% return, with compound EPS growth of 12% annually

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. Total shareholder return (TSR) stands at 209%, boosted by consistent dividends

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📈 Technical & Sentiment Indicators

RSI: 49.4 – Neutral zone, suggesting consolidation.

MACD: -32.5 – Bearish crossover, indicating short-term weakness.

Volume Dip – Below weekly average, signaling reduced trading interest.

DMA 50 & 200: Price is hovering near DMA 50 and above DMA 200 — technically stable.

Analyst consensus shows a 1-year price target of ₹2,596, implying ~13% upside

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💡 Investment Strategy

🔽 Entry Zone

Ideal Buy Range: ₹2,200–₹2,280, near support and below DMA 50.

Current Price ₹2,305: Slightly above ideal entry, still reasonable for accumulation.

🕰️ Long-Term Holding

Strong Hold or Accumulate on Dips: High ROCE, low debt, and sector leadership make Coromandel a compelling long-term play.

Monitor Institutional Sentiment: FII inflow (+3.67%) is encouraging, though DII outflow (−3.11%) suggests mixed views.

For deeper insights, check out Simply Wall St’s 5-year earnings analysis or Trendlyne’s technical and valuation dashboard. Let me know if you'd like a peer comparison with UPL or PI Industries.

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simplywall.st

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trendlyne.com

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