DEEPAKFERT - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.5
| Stock Code | DEEPAKFERT | Market Cap | 18,601 Cr. | Current Price | 1,474 ₹ | High / Low | 1,779 ₹ |
| Stock P/E | 57.7 | Book Value | 274 ₹ | Dividend Yield | 0.68 % | ROCE | 14.9 % |
| ROE | 12.3 % | Face Value | 10.0 ₹ | DMA 50 | 1,202 ₹ | DMA 200 | 1,218 ₹ |
| Chg in FII Hold | 0.00 % | Chg in DII Hold | 0.07 % | PAT Qtr | 10.8 Cr. | PAT Prev Qtr | 50.0 Cr. |
| RSI | 71.7 | MACD | 62.5 | Volume | 23,77,869 | Avg Vol 1Wk | 9,28,344 |
| Low price | 865 ₹ | High price | 1,779 ₹ | PEG Ratio | 2.04 | Debt to equity | 0.13 |
| 52w Index | 66.6 % | Qtr Profit Var | -83.9 % | EPS | 25.5 ₹ | Industry PE | 19.6 |
📊 Financial Overview: Deepak Fertilizers (DEEPAKFERT) shows mixed fundamentals. ROE is 12.3% and ROCE is 14.9%, reflecting modest efficiency. Debt-to-equity is low at 0.13, ensuring financial stability. Dividend yield is modest at 0.68%. Quarterly PAT dropped sharply from ₹50 Cr. to ₹10.8 Cr., showing an -83.9% variation, which raises concerns about earnings consistency despite strong revenue growth in prior quarters.
💹 Valuation Indicators: Current P/E of 57.7 is significantly above the industry average of 19.6, suggesting overvaluation. P/B ratio is ~5.4 (1474/274), which is expensive. PEG ratio of 2.04 signals limited growth relative to valuation. Intrinsic value appears lower than current price, implying cautious accumulation.
🏢 Business Model & Advantage: Deepak Fertilizers operates in chemicals and fertilizers, with strengths in industrial chemicals, mining chemicals, and crop nutrition. Its competitive advantage lies in diversified product lines and strong distribution. However, profitability pressures and commodity price volatility limit near-term attractiveness.
📈 Entry Zone: A favorable entry zone lies between ₹1,250–1,350, closer to intrinsic value and support levels. Current price (₹1,474) is above this zone, making staggered accumulation advisable.
🔒 Long-Term Holding Guidance: Deepak Fertilizers is a diversified player with industry relevance, but stretched valuations and sharp profit decline make it risky. Long-term investors should hold cautiously, monitoring commodity cycles and earnings recovery.
Positive
- 🌟 Low debt-to-equity (0.13)
- 🌟 Diversified operations across chemicals and fertilizers
- 🌟 DII holdings increased (+0.07%)
Limitation
- ⚠️ Very high P/E (57.7) vs industry average (19.6)
- ⚠️ PEG ratio (2.04) signals limited growth
- ⚠️ Dividend yield modest (0.68%)
- ⚠️ Quarterly profit decline (-83.9%)
Company Negative News
- 📉 PAT dropped from ₹50 Cr. to ₹10.8 Cr.
- 📉 Earnings volatility due to commodity cycles
Company Positive News
- 📈 DII holdings increased (+0.07%)
- 📈 Strong diversified portfolio in chemicals and fertilizers
Industry
- 🏦 Industry P/E at 19.6 reflects moderate valuations
- 🏦 Fertilizer and chemical sector supported by agricultural demand and industrial growth
Conclusion
✅ Deepak Fertilizers has industry relevance and a diversified portfolio, but stretched valuations and sharp profit decline limit attractiveness. A better entry zone lies between ₹1,250–1,350. Long-term investors should hold cautiously, awaiting earnings recovery and stability in commodity cycles.
Would you like me to also prepare a fertilizer sector outlook to evaluate how agricultural demand and input price trends could influence Deepak Fertilizers’ long-term trajectory?