EMAMILTD - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.0

📊 Core Financials

• Revenue & Profitability: PAT stood at 182 Cr. vs 163 Cr. previous quarter, showing growth despite -14.8% variation YoY.
• Margins: ROE at 31.5% and ROCE at 34.0% reflect excellent efficiency and profitability.
• Debt Ratios: Debt-to-equity at 0.01 — virtually debt-free, ensuring financial resilience.
• Cash Flows: Dividend yield of 1.53% provides healthy shareholder returns.

💹 Valuation Indicators

• P/E Ratio: 27.9 vs Industry PE of 49.7 — undervalued compared to peers.
• P/B Ratio: Current Price 520 ₹ / Book Value 71.8 ₹ ≈ 7.2, premium valuation.
• PEG Ratio: 35.3 — indicates expensive growth-adjusted valuation.
• Intrinsic Value: Strong fundamentals justify valuation, though PEG suggests caution.

🏢 Business Model & Competitive Advantage

• Operates in FMCG sector with strong presence in personal care and healthcare products.
• Competitive advantage lies in brand strength, wide distribution, and debt-free structure.
• Institutional sentiment mixed: FII holdings reduced (-0.96%), while DII holdings increased (+0.94%).

📈 Technical & Entry Zone

• DMA 50: 536 ₹ | DMA 200: 569 ₹ — stock trading below averages, indicating weakness.
• RSI: 48.6 — neutral zone.
• MACD: 1.82 — mild bullish momentum.
• Entry Zone: Attractive near 500–510 ₹ for accumulation.
• Long-Term Holding: Strong candidate for long-term portfolio given profitability, brand strength, and low debt.

✅ Positive

• Excellent ROE (31.5%) and ROCE (34.0%).
• Debt-free balance sheet (Debt-to-equity 0.01).
• Dividend yield of 1.53% provides healthy shareholder returns.
• DII holdings increased (+0.94%), reflecting domestic institutional support.

⚠️ Limitation

• PEG ratio of 35.3 indicates expensive growth-adjusted valuation.
• P/B ratio of 7.2 suggests premium valuation.
• FII holdings reduced (-0.96%), showing weaker foreign investor sentiment.

📉 Company Negative News

• Quarterly profit variation (-14.8%) indicates earnings pressure.
• Stock trading below DMA 50 and DMA 200, reflecting technical weakness.

📈 Company Positive News

• PAT improved from 163 Cr. to 182 Cr. sequentially.
• DII holdings increased (+0.94%), reflecting domestic institutional confidence.

🏭 Industry

• Industry PE at 49.7 — sector trades at premium valuations compared to EMAMILTD’s lower P/E.
• FMCG industry benefits from consistent demand, brand loyalty, and defensive nature.

🔎 Conclusion

EMAMILTD is a fundamentally strong FMCG company with excellent return ratios, debt-free balance sheet, and strong brand presence. Valuations are attractive compared to industry peers, though PEG ratio suggests caution. Entry is advisable near 500–510 ₹, and it remains a solid long-term holding given strong fundamentals and industry resilience.