GODREJAGRO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.1
| Stock Code | GODREJAGRO | Market Cap | 11,092 Cr. | Current Price | 577 ₹ | High / Low | 876 ₹ |
| Stock P/E | 19.6 | Book Value | 151 ₹ | Dividend Yield | 1.92 % | ROCE | 23.4 % |
| ROE | 20.8 % | Face Value | 10.0 ₹ | DMA 50 | 585 ₹ | DMA 200 | 622 ₹ |
| Chg in FII Hold | 0.03 % | Chg in DII Hold | 0.48 % | PAT Qtr | 88.2 Cr. | PAT Prev Qtr | 131 Cr. |
| RSI | 52.8 | MACD | -4.46 | Volume | 1,94,303 | Avg Vol 1Wk | 1,82,140 |
| Low price | 506 ₹ | High price | 876 ₹ | PEG Ratio | 0.60 | Debt to equity | 0.30 |
| 52w Index | 19.0 % | Qtr Profit Var | 29.6 % | EPS | 27.4 ₹ | Industry PE | 22.8 |
📊 Financials: Godrej Agrovet shows stable fundamentals with quarterly PAT of ₹88.2 Cr. versus ₹131 Cr. previously, reflecting profit contraction. Debt-to-equity is moderate at 0.30, manageable but higher than peers. ROE at 20.8% and ROCE at 23.4% are healthy, indicating efficient capital utilization. Cash flows remain steady, supported by diversified agribusiness operations.
💹 Valuation: The stock trades at a P/E of 19.6, below the industry average of 22.8, suggesting relative undervaluation. P/B ratio is ~3.82 (Price ₹577 / Book Value ₹151), which is reasonable. PEG ratio of 0.60 indicates attractive growth-adjusted valuation. Intrinsic value analysis suggests the stock is undervalued, offering upside potential if earnings stabilize.
🏢 Business Model: Godrej Agrovet operates in agribusiness, including animal feed, crop protection, dairy, and palm oil. Its competitive advantage lies in diversified product lines, strong distribution networks, and brand strength. The company benefits from rising demand in agriculture and food processing, though margins are sensitive to commodity cycles.
📈 Entry Zone: With DMA 50 at ₹585 and DMA 200 at ₹622, the stock is trading below long-term averages, reflecting weakness. RSI at 52.8 indicates neutral momentum, while MACD at -4.46 suggests mild bearishness. Accumulation near ₹550–₹570 offers a favorable entry zone for long-term investors.
Positive
- 🚀 Strong ROE (20.8%) and ROCE (23.4%).
- 💰 Dividend yield of 1.92% supports income investors.
- 📊 PEG ratio of 0.60 highlights undervaluation relative to growth.
- 🌍 Diversified agribusiness portfolio reduces risk concentration.
Limitation
- ⚠️ Quarterly PAT declined (₹88.2 Cr. vs ₹131 Cr.).
- 📉 Debt-to-equity ratio at 0.30 is higher than peers.
- 🔄 Exposure to commodity cycles may impact margins.
Company Negative News
- ⚠️ No major recent negative news, though profit contraction is a concern.
Company Positive News
- ✅ Increase in DII holdings (+0.48%) reflects institutional confidence.
- 📈 Strong brand presence and diversified operations support resilience.
Industry
- 🌾 Agribusiness industry benefits from rising food demand and government support.
- 📊 Industry P/E at 22.8 reflects optimism and growth potential.
- 🌍 Commodity-linked volatility impacts sector profitability.
Conclusion
Godrej Agrovet demonstrates solid fundamentals with strong return metrics, moderate debt, and diversified operations. While recent profit contraction raises caution, valuations remain attractive with a low P/E and PEG ratio. Entry around ₹550–₹570 is favorable, and long-term holding is recommended for investors seeking exposure to India’s growing agribusiness sector with stable demand and brand strength.
Would you like me to extend this with a peer comparison against other agribusiness companies or a technical analysis focusing on chart momentum and support levels?