⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
DEEPAKFERT - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.2
| Stock Code | DEEPAKFERT | Market Cap | 12,509 Cr. | Current Price | 990 ₹ | High / Low | 1,779 ₹ |
| Stock P/E | 38.8 | Book Value | 274 ₹ | Dividend Yield | 1.01 % | ROCE | 14.9 % |
| ROE | 12.3 % | Face Value | 10.0 ₹ | DMA 50 | 1,239 ₹ | DMA 200 | 1,323 ₹ |
| Chg in FII Hold | -0.63 % | Chg in DII Hold | 0.56 % | PAT Qtr | 10.8 Cr. | PAT Prev Qtr | 50.0 Cr. |
| RSI | 21.8 | MACD | -49.8 | Volume | 4,80,433 | Avg Vol 1Wk | 7,48,800 |
| Low price | 888 ₹ | High price | 1,779 ₹ | PEG Ratio | 1.37 | Debt to equity | 0.13 |
| 52w Index | 11.4 % | Qtr Profit Var | -83.9 % | EPS | 25.5 ₹ | Industry PE | 17.5 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT dropped sharply from 50 Cr. to 10.8 Cr. (-83.9%), showing significant earnings pressure.
- Profit Margins: ROE at 12.3% and ROCE at 14.9% are modest, reflecting average efficiency.
- Debt Ratios: Debt-to-equity at 0.13 highlights a low-leverage balance sheet.
- Cash Flows: Dividend yield at 1.01% provides moderate shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 38.8 vs Industry PE of 17.5, indicating overvaluation.
- P/B Ratio: Current Price 990 ₹ / Book Value 274 ₹ ≈ 3.61, moderately high.
- PEG Ratio: 1.37, suggesting growth is priced reasonably but with earnings volatility.
- Intrinsic Value: Estimated fair value around 900–950 ₹, making current price slightly above fair zone.
🏢 Business Model & Competitive Advantage
- Deepak Fertilizers operates in chemicals, fertilizers, and industrial products with strong domestic presence.
- Competitive advantage lies in diversified product portfolio and established distribution network.
- Exposure to cyclical fertilizer and chemical demand adds volatility to earnings.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 900–950 ₹, closer to intrinsic value and near support levels.
- Long-Term Holding: Suitable for cautious long-term investors, but earnings volatility and premium valuation require careful entry.
✅ Positive
- Diversified business model across fertilizers and chemicals.
- Low debt-to-equity ratio (0.13), manageable leverage.
- DII holdings increased (+0.56%), showing domestic institutional support.
⚠️ Limitation
- Quarterly PAT decline (-83.9%) highlights earnings weakness.
- P/E ratio significantly above industry average, indicating overvaluation.
- Stock trading below DMA 50 and DMA 200, showing weak momentum.
📉 Company Negative News
- Decline in FII holding (-0.63%) indicates reduced foreign investor confidence.
- Technical indicators (RSI 21.8, MACD -49.8) show oversold bearish sentiment.
📈 Company Positive News
- DII holdings increased (+0.56%), showing domestic support.
- Dividend yield of 1.01% provides steady income to shareholders.
🏭 Industry
- Chemicals and fertilizers industry PE at 17.5, much lower than Deepak Fertilizers’ 38.8, suggesting relative overvaluation.
- Industry growth supported by government initiatives and rising demand for agri-inputs.
🔎 Conclusion
- Deepak Fertilizers is a diversified player with low debt but weak earnings performance.
- Valuation is stretched compared to industry peers, making current levels unattractive for fresh entry.
- Best suited for long-term investors with cautious entry around 900–950 ₹; accumulation strategy recommended for exposure to cyclical fertilizer and chemical demand.
I can also expand on fertilizer demand cycles and government subsidy trends to show how they could influence Deepak Fertilizers’ earnings trajectory.