⚠ 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.
GODREJAGRO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.0
| Stock Code | GODREJAGRO | Market Cap | 10,003 Cr. | Current Price | 519 ₹ | High / Low | 876 ₹ |
| Stock P/E | 17.2 | Book Value | 141 ₹ | Dividend Yield | 2.12 % | ROCE | 24.4 % |
| ROE | 20.9 % | Face Value | 10.0 ₹ | DMA 50 | 567 ₹ | DMA 200 | 656 ₹ |
| Chg in FII Hold | -0.92 % | Chg in DII Hold | 0.20 % | PAT Qtr | 177 Cr. | PAT Prev Qtr | 169 Cr. |
| RSI | 38.0 | MACD | -13.9 | Volume | 94,374 | Avg Vol 1Wk | 1,37,768 |
| Low price | 506 ₹ | High price | 876 ₹ | PEG Ratio | 1.46 | Debt to equity | 0.57 |
| 52w Index | 3.55 % | Qtr Profit Var | 34.2 % | EPS | 30.2 ₹ | Industry PE | 20.1 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT increased from 169 Cr. to 177 Cr., showing steady growth with 34.2% YoY variation.
- Margins: ROE at 20.9% and ROCE at 24.4% reflect strong profitability and efficient capital utilization.
- Debt Ratios: Debt-to-equity at 0.57 indicates moderate leverage compared to peers.
- Cash Flows: Stable operating cash flows supported by diversified agribusiness operations.
- Return Metrics: EPS at 30.2 ₹ highlights consistent earnings generation.
💹 Valuation Indicators
- P/E Ratio: 17.2, below industry PE of 20.1, suggesting undervaluation.
- P/B Ratio: ~3.7 (Current Price / Book Value), reasonable for agribusiness sector.
- PEG Ratio: 1.46, fair valuation considering growth prospects.
- Intrinsic Value: Current price (519 ₹) is near support levels, offering potential upside if profitability sustains.
🏢 Business Model & Competitive Advantage
- Operates in agribusiness with focus on animal feed, crop protection, and dairy.
- Competitive advantage lies in strong brand presence, diversified portfolio, and distribution reach.
- Resilient business model with steady demand from agriculture and allied sectors.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 500 ₹ – 520 ₹ (near 52-week low and below DMA 50).
- Long-Term Holding: Suitable for long-term investors seeking exposure to agribusiness growth, though leverage should be monitored.
Positive
- Strong ROE and ROCE.
- Dividend yield of 2.12% provides income support.
- Undervalued compared to industry PE.
- Consistent PAT growth.
Limitation
- Moderate debt-to-equity ratio (0.57) increases financial risk.
- Stock trading below DMA 50 and DMA 200 indicates weak momentum.
- RSI at 38 suggests oversold conditions.
Company Negative News
- Reduction in FII holdings (-0.92%) shows cautious foreign investor sentiment.
Company Positive News
- Quarterly PAT growth and rising domestic institutional inflows (+0.20%).
- Strong brand presence and diversified agribusiness portfolio.
Industry
- Agribusiness sector remains resilient with steady demand for food and allied products.
- Industry PE at 20.1 reflects moderate optimism and stable valuations.
Conclusion
- Godrej Agrovet is a fundamentally strong agribusiness company with healthy profitability and dividend support.
- Valuation is attractive compared to industry, though debt levels and weak momentum are concerns.
- Best suited for long-term investors seeking exposure to agriculture growth, with entry near current support levels for better risk-reward.
I can also contrast Godrej Agrovet’s valuation and profitability with peers like Avanti Feeds or UPL to highlight its relative positioning in the agribusiness sector.