EICHERMOT - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 4.4

📈 Positive

• 📊 Exceptional return metrics — ROCE at 31.7% and ROE at 25.1% reflect superior capital efficiency.
• 💰 Ultra-low debt-to-equity ratio of 0.01 ensures financial strength and minimal leverage risk.
• 📈 EPS of ₹164 supports robust earnings visibility and valuation strength.
• 📈 PEG ratio of 1.09 indicates fair valuation relative to growth.
• 📈 FII holding increased by 1.16%, showing strong foreign investor confidence.
• 📈 MACD at 50.0 and RSI at 50.7 reflect stable technical momentum.
• 📈 Trading above DMA50 and DMA200 (₹6,685 and ₹5,857), confirming medium-term bullish trend.

⚠️ Limitation

• 📉 P/E of 42.7 is slightly above industry average (39.0), suggesting a premium valuation.
• 📉 DII holding declined by 1.05%, indicating cautious domestic sentiment.
• 📉 Dividend yield of 1.01% offers modest passive income.

📰 Company Negative News

• 📉 Trading near 52-week high (₹7,124), limiting short-term upside potential.

🌟 Company Positive News

• 📈 Quarterly PAT growth of 20.1% (₹1,306 Cr. vs ₹1,125 Cr.) shows consistent profitability.
• 📈 Volume above 1-week average suggests strong investor interest and liquidity.

🏍️ Industry

• 🏍️ EICHERMOT operates in the premium motorcycle and commercial vehicle segment, with flagship brand Royal Enfield offering strong brand equity and export potential.
• 📊 Industry P/E of 39.0 reflects moderate growth expectations and cyclical exposure to auto demand.

🧭 Conclusion

• 📌 Suggested entry zone: ₹6,600–₹6,750, near DMA50 for better margin of safety.
• 🕰️ Long-term holding favorable due to strong fundamentals, brand leadership, and global expansion opportunities.
• ⚖️ Monitor valuation multiples and domestic institutional flows before aggressive accumulation.