DEEPAKFERT - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 3.0

📊 Core Financials

• Revenue & Profitability: PAT declined to 50 Cr. from 86.8 Cr., showing -50% quarterly profit variation.
• Margins: ROE at 12.3% and ROCE at 14.9% indicate moderate efficiency.
• Debt Ratios: Debt-to-equity at 0.13 — low leverage, financially stable.
• Cash Flows: Dividend yield of 0.84% provides modest shareholder returns.

💹 Valuation Indicators

• P/E Ratio: 40.4 vs Industry PE of 20.0 — overvalued compared to peers.
• P/B Ratio: Current Price 1,211 ₹ / Book Value 274 ₹ ≈ 4.42, premium valuation.
• PEG Ratio: 1.43 — reasonable growth-adjusted valuation.
• Intrinsic Value: Current valuation stretched; fundamentals do not fully justify premium pricing.

🏢 Business Model & Competitive Advantage

• Operates in fertilizers and chemicals, benefiting from agriculture and industrial demand.
• Competitive advantage lies in diversified product portfolio and established market presence.
• DII holdings increased (+0.34%), showing domestic institutional support, though FII reduced (-0.31%).

📈 Technical & Entry Zone

• DMA 50: 1,362 ₹ | DMA 200: 1,366 ₹ — stock trading below averages, indicating weakness.
• RSI: 27.4 — oversold territory, potential rebound zone.
• MACD: -55.5 — bearish momentum persists.
• Entry Zone: Attractive near 950–1,050 ₹ for accumulation.
• Long-Term Holding: Suitable for cautious investors; requires earnings recovery for stronger conviction.

✅ Positive

• Low debt-to-equity ratio (0.13) ensures financial stability.
• DII holdings increased (+0.34%), reflecting domestic institutional confidence.
• Diversified business model across fertilizers and chemicals.

⚠️ Limitation

• High P/E ratio (40.4) compared to industry average.
• P/B ratio of 4.42 indicates premium valuation.
• Dividend yield of 0.84% offers limited shareholder returns.

📉 Company Negative News

• Quarterly PAT declined from 86.8 Cr. to 50 Cr. (-50%).
• FII holdings reduced (-0.31%), showing weaker foreign investor sentiment.

📈 Company Positive News

• DII holdings increased (+0.34%), reflecting domestic institutional support.
• Debt remains low, ensuring financial resilience.

🏭 Industry

• Industry PE at 20.0 — sector trades at moderate valuations.
• Fertilizer and chemical industry benefits from agriculture demand but faces cyclical risks.

🔎 Conclusion

DEEPAKFERT is financially stable with low debt but faces earnings pressure and stretched valuations. Entry is attractive near 950–1,050 ₹, with cautious long-term holding recommended. Improvement in profitability and sustained growth will be key for stronger upside potential.