⚠ 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.
GODREJCP - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.9
| Stock Code | GODREJCP | Market Cap | 1,18,727 Cr. | Current Price | 1,161 ₹ | High / Low | 1,309 ₹ |
| Stock P/E | 85.1 | Book Value | 78.8 ₹ | Dividend Yield | 1.72 % | ROCE | 19.3 % |
| ROE | 14.9 % | Face Value | 1.00 ₹ | DMA 50 | 1,193 ₹ | DMA 200 | 1,192 ₹ |
| Chg in FII Hold | -2.82 % | Chg in DII Hold | 2.91 % | PAT Qtr | 431 Cr. | PAT Prev Qtr | 356 Cr. |
| RSI | 36.8 | MACD | -7.75 | Volume | 8,28,518 | Avg Vol 1Wk | 21,67,901 |
| Low price | 980 ₹ | High price | 1,309 ₹ | PEG Ratio | -39.4 | Debt to equity | 0.33 |
| 52w Index | 55.1 % | Qtr Profit Var | 26.1 % | EPS | 13.1 ₹ | Industry PE | 46.8 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT rose from 356 Cr. to 431 Cr., showing strong sequential growth with 26.1% YoY variation.
- Margins: ROE at 14.9% and ROCE at 19.3% reflect moderate profitability compared to FMCG peers.
- Debt Ratios: Debt-to-equity at 0.33 indicates manageable leverage but higher than some competitors.
- Cash Flows: Stable operating cash flows supported by FMCG demand across categories.
- Return Metrics: EPS at 13.1 ₹ is modest relative to current valuation.
💹 Valuation Indicators
- P/E Ratio: 85.1, significantly above industry PE of 46.8, suggesting overvaluation.
- P/B Ratio: ~14.7 (Current Price / Book Value), reflecting expensive valuation relative to assets.
- PEG Ratio: -39.4, distorted due to weak growth-adjusted valuation, signaling caution.
- Intrinsic Value: Current price (1,161 ₹) appears overvalued; better entry opportunities may arise closer to 1,000 ₹.
🏢 Business Model & Competitive Advantage
- Operates in FMCG with strong presence in personal care, household products, and emerging markets.
- Competitive advantage lies in brand strength, distribution reach, and diversified product portfolio.
- Resilient business model with steady demand, though profitability is pressured by high valuations.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 1,000 ₹ – 1,080 ₹ (near 52-week low).
- Long-Term Holding: Suitable for long-term investors seeking FMCG exposure, but entry should be at lower levels for better risk-reward.
Positive
- Strong quarterly PAT growth.
- Healthy dividend yield of 1.72%.
- Strong brand presence and diversified FMCG portfolio.
- Rising DII inflows (+2.91%) show domestic confidence.
Limitation
- High P/E and P/B ratios indicate expensive valuation.
- PEG ratio signals poor growth-adjusted valuation.
- Debt-to-equity ratio at 0.33 is higher than some FMCG peers.
Company Negative News
- Reduction in FII holdings (-2.82%) shows cautious foreign investor sentiment.
- Weak technical indicators (RSI 36.8, MACD -7.75) reflect bearish momentum.
Company Positive News
- Quarterly PAT growth of 26.1% highlights operational improvement.
- Strong domestic institutional inflows (+2.91%) support stock stability.
Industry
- FMCG sector remains defensive with steady demand and premium valuations.
- Industry PE at 46.8 reflects investor optimism and sector resilience.
Conclusion
- Godrej Consumer Products is a fundamentally strong FMCG player with robust brand equity and steady demand.
- Valuation is stretched, limiting near-term upside.
- Best suited for long-term investors seeking FMCG exposure, with entry near lower support levels for better returns.
I can also contrast Godrej Consumer Products with peers like Hindustan Unilever or Dabur to highlight its relative valuation and profitability positioning.