DABUR - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | DABUR | Market Cap | 80,029 Cr. | Current Price | 451 ₹ | High / Low | 577 ₹ |
| Stock P/E | 53.2 | Book Value | 42.4 ₹ | Dividend Yield | 1.77 % | ROCE | 25.1 % |
| ROE | 20.1 % | Face Value | 1.00 ₹ | DMA 50 | 459 ₹ | DMA 200 | 486 ₹ |
| Chg in FII Hold | -0.07 % | Chg in DII Hold | 0.17 % | PAT Qtr | 296 Cr. | PAT Prev Qtr | 451 Cr. |
| RSI | 47.1 | MACD | 0.97 | Volume | 9,95,653 | Avg Vol 1Wk | 14,69,219 |
| Low price | 401 ₹ | High price | 577 ₹ | PEG Ratio | 19.0 | Debt to equity | 0.08 |
| 52w Index | 28.3 % | Qtr Profit Var | 18.0 % | EPS | 8.41 ₹ | Industry PE | 44.2 |
📊 Financial Overview: Dabur shows moderate fundamentals. ROE is 20.1% and ROCE is 25.1%, reflecting strong efficiency. Debt-to-equity is low at 0.08, ensuring financial stability. Dividend yield is healthy at 1.77%. Quarterly PAT declined from ₹451 Cr. to ₹296 Cr., showing an 18% variation, which highlights short-term earnings pressure.
💹 Valuation Indicators: Current P/E of 53.2 is significantly above the industry average of 44.2, suggesting overvaluation. P/B ratio is ~10.6 (451/42.4), which is expensive. PEG ratio of 19.0 signals weak growth prospects relative to valuation. Intrinsic value appears lower than current price, implying cautious accumulation.
🏢 Business Model & Advantage: Dabur operates in FMCG with strengths in healthcare, personal care, and food products. Its competitive advantage lies in brand heritage, diversified portfolio, and strong distribution network. However, earnings volatility and stretched valuations limit near-term attractiveness.
📈 Entry Zone: A favorable entry zone lies between ₹420–440, closer to intrinsic value and support levels. Current price (₹451) is slightly above this zone, making staggered accumulation advisable.
🔒 Long-Term Holding Guidance: Dabur is a strong long-term play due to its brand strength, diversified portfolio, and low debt. Despite stretched valuations, its business moat supports resilience. Long-term investors can hold cautiously, monitoring earnings recovery and consumer demand trends.
Positive
- 🌟 Strong ROE (20.1%) and ROCE (25.1%)
- 🌟 Low debt-to-equity (0.08)
- 🌟 Healthy dividend yield (1.77%)
- 🌟 Diversified FMCG portfolio with strong brand heritage
Limitation
- ⚠️ Very high P/E (53.2) vs industry average (44.2)
- ⚠️ High P/B (~10.6)
- ⚠️ PEG ratio (19.0) signals weak growth prospects
- ⚠️ Quarterly profit decline (-18%)
Company Negative News
- 📉 PAT dropped from ₹451 Cr. to ₹296 Cr.
- 📉 FII holdings reduced (-0.07%)
Company Positive News
- 📈 DII holdings increased (+0.17%)
- 📈 Strong brand recognition and distribution network
Industry
- 🏦 Industry P/E at 44.2 reflects premium valuations
- 🏦 FMCG sector supported by rising consumer demand and rural penetration
Conclusion
✅ Dabur is financially stable with strong brand presence and efficient operations, but stretched valuations and profit decline limit attractiveness. A better entry zone lies between ₹420–440. Long-term investors can hold cautiously, leveraging its FMCG leadership while awaiting earnings recovery.
Would you like me to also prepare a FMCG sector outlook to assess how consumer demand trends could influence Dabur’s long-term growth?