⚠ 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.
DEEPAKNTR - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.3
| Stock Code | DEEPAKNTR | Market Cap | 21,699 Cr. | Current Price | 1,590 ₹ | High / Low | 2,400 ₹ |
| Stock P/E | 102 | Book Value | 232 ₹ | Dividend Yield | 0.47 % | ROCE | 10.1 % |
| ROE | 8.22 % | Face Value | 2.00 ₹ | DMA 50 | 1,630 ₹ | DMA 200 | 1,819 ₹ |
| Chg in FII Hold | -0.15 % | Chg in DII Hold | 0.50 % | PAT Qtr | 112 Cr. | PAT Prev Qtr | 30.3 Cr. |
| RSI | 47.4 | MACD | -13.3 | Volume | 67,658 | Avg Vol 1Wk | 1,23,972 |
| Low price | 1,513 ₹ | High price | 2,400 ₹ | PEG Ratio | -5.18 | Debt to equity | 0.01 |
| 52w Index | 8.71 % | Qtr Profit Var | -21.5 % | EPS | 15.6 ₹ | Industry PE | 26.3 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT rose from 30.3 Cr. to 112 Cr., but YoY profit variation shows -21.5%, indicating inconsistency.
- Profit Margins: ROE at 8.22% and ROCE at 10.1% are modest, reflecting weak efficiency compared to peers.
- Debt Ratios: Debt-to-equity at 0.01 highlights a near debt-free balance sheet.
- Cash Flows: Dividend yield at 0.47% provides limited shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 102 vs Industry PE of 26.3, indicating extreme overvaluation.
- P/B Ratio: Current Price 1,590 ₹ / Book Value 232 ₹ ≈ 6.85, premium valuation.
- PEG Ratio: -5.18, reflecting poor or negative growth expectations.
- Intrinsic Value: Estimated fair value around 1,400–1,450 ₹, making current price significantly overvalued.
🏢 Business Model & Competitive Advantage
- Deepak Nitrite operates in chemicals and specialty products with strong domestic and export presence.
- Competitive advantage lies in diversified product portfolio and leadership in phenolics and specialty chemicals.
- However, cyclical demand and margin pressures limit consistency in earnings.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive only if price corrects to 1,400–1,450 ₹, closer to intrinsic value.
- Long-Term Holding: Suitable for long-term investors seeking exposure to chemicals, but high valuation and weak return ratios require cautious entry.
✅ Positive
- Debt-free balance sheet ensures financial stability.
- Strong sequential PAT growth (30.3 Cr. → 112 Cr.).
- DII holdings increased (+0.50%), showing domestic institutional support.
⚠️ Limitation
- Extremely high P/E ratio (102) compared to industry average (26.3).
- Weak ROE (8.22%) and ROCE (10.1%) highlight poor efficiency.
- PEG ratio negative, reflecting poor growth visibility.
📉 Company Negative News
- Decline in FII holding (-0.15%) indicates reduced foreign investor confidence.
- Technical indicators (MACD -13.3) show bearish sentiment.
📈 Company Positive News
- DII holdings increased (+0.50%), showing domestic support.
- Sequential PAT growth reinforces operational improvement.
🏭 Industry
- Chemicals industry PE at 26.3, much lower than Deepak Nitrite’s 102, suggesting relative overvaluation.
- Industry growth supported by rising demand for specialty chemicals and exports.
🔎 Conclusion
- Deepak Nitrite is a major chemicals player with debt-free operations but weak efficiency metrics.
- Valuation is extremely stretched compared to industry peers, making current levels unattractive for fresh entry.
- Best suited for long-term investors only if price corrects to 1,400–1,450 ₹; cautious accumulation advised for exposure to India’s specialty chemicals growth story.
I can also expand on global chemical demand cycles to show how they could influence Deepak Nitrite’s earnings trajectory if you’d like.