GODREJIND - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.1

📊 Core Financials Breakdown

Profitability

ROE: 9.04% and ROCE: 8.13% — modest returns, below ideal for a diversified conglomerate.

EPS: ₹1.62 — weak earnings base, with recent quarterly losses of ₹30 Cr (vs ₹68.3 Cr prior).

Qtr Profit Var: -128% — sharp decline, signaling volatility or one-off charges.

Balance Sheet & Leverage

Debt-to-Equity: 5.90 — extremely high leverage, a major red flag for financial health.

Book Value: ₹50.6 — implies a P/B ratio of ~24, which is highly inflated.

Dividend Yield: 0.00% — no income for long-term holders.

💰 Valuation Metrics

Metric Value Comment

P/E Ratio 753 Astronomically high vs industry PE of 25.9 — unjustifiable

PEG Ratio 4.01 Expensive relative to growth — caution warranted

Intrinsic Value ~₹950–₹1,050 CMP significantly above fair value zone

Valuation is disconnected from earnings and return metrics. This is likely driven by holding company premium or sentiment.

🏢 Business Model & Competitive Edge

Sector: Conglomerate — chemicals, consumer goods, real estate, agri-business, and financial services.

Strengths

Part of the Godrej Group — strong brand equity and diversified exposure.

Chemical division expanding globally with ₹750 Cr investment

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Subsidiaries like Godrej Consumer Products, Godrej Properties, and Godrej Agrovet contribute to consolidated value

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Challenges

High debt and negative cash flows

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Recent losses and volatile earnings.

FII holding down (-1.31%) — cautious foreign sentiment.

📉 Technicals & Entry Zone

Current Price: ₹1,216

DMA 50: ₹1,200 | DMA 200: ₹1,127 — bullish trend intact

RSI: 52.0 — neutral zone

MACD: Positive — momentum building

📌 Suggested Entry Zone: ₹1,050–₹1,100

A dip near the 200 DMA would offer a better margin of safety, especially if earnings stabilize.

🧭 Long-Term Holding Guidance

Hold with caution: If already invested, monitor debt levels and profitability trends closely.

Avoid fresh entry at CMP: Wait for valuation to cool or for earnings to justify the premium.

You can explore Godrej Industries’ full financials and analyst insights or review its stock overview and performance for deeper context. Let me know if you'd like a sum-of-the-parts valuation or peer comparison with other holding companies.

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stockanalysis.com

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www.tipranks.com

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