GODREJCP - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 3.9

📊 Core Financials Breakdown

Profitability

ROE: 14.9% and ROCE: 19.3% — solid, though not exceptional for a large-cap FMCG player.

EPS: ₹13.1 — moderate, with quarterly PAT at ₹355 Cr, slightly down from ₹254 Cr.

Qtr Profit Var: -3.94% — indicates margin pressure or one-off costs.

Balance Sheet & Leverage

Debt-to-Equity: 0.32 — manageable, typical for consumer businesses with expansion plans.

Book Value: ₹81.8 — implies a P/B ratio of ~15.1, high but justified by brand premium.

Dividend Yield: 1.21% — decent, adds value for long-term holders.

💰 Valuation Metrics

Metric Value Comment

P/E Ratio 94.3 Extremely high vs industry average (52.8) — overvalued

PEG Ratio -43.7 Negative PEG suggests unreliable growth or earnings volatility

Intrinsic Value ~₹1,100–₹1,150 CMP slightly above fair value zone

Valuation is stretched, especially with a negative PEG and high P/E.

🧼 Business Model & Competitive Edge

Sector: FMCG — personal care, home care, and hygiene products.

Strengths

Iconic brands like GoodKnight, Cinthol, HIT, and Godrej Expert.

Strong presence across India, Indonesia, Africa, and Latin America.

Recent product launches and distribution expansion in rural markets.

DII holding up (+0.21%) — positive domestic sentiment.

Challenges

FII holding down (-0.19%) — cautious foreign stance.

PEG ratio and high valuation suggest growth expectations may be overbaked.

Profit contraction and muted volume growth in some segments.

📉 Technicals & Entry Zone

Current Price: ₹1,238

DMA 50: ₹1,238 | DMA 200: ₹1,219 — trading near support

RSI: 48.7 — neutral zone

MACD: Slightly positive — momentum stabilizing

📌 Suggested Entry Zone: ₹1,150–₹1,200

A dip near the 200 DMA would offer a better margin of safety for accumulation.

🧭 Long-Term Holding Guidance

Hold if invested: Strong brand equity, diversified portfolio, and stable cash flows make Godrej Consumer a durable long-term play.

Accumulate on dips: Ideal for investors seeking exposure to resilient consumer demand and emerging market growth.

Brokerages like HSBC and Citi maintain a “Buy” rating with targets around ₹1,400–₹1,420, citing strength in India’s home care segment

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