⚠ 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.
GODREJIND - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.9
| Stock Code | GODREJIND | Market Cap | 32,963 Cr. | Current Price | 980 ₹ | High / Low | 1,392 ₹ |
| Stock P/E | 35,829 | Book Value | 52.7 ₹ | Dividend Yield | 0.00 % | ROCE | 8.13 % |
| ROE | 9.04 % | Face Value | 1.00 ₹ | DMA 50 | 1,020 ₹ | DMA 200 | 1,077 ₹ |
| Chg in FII Hold | -0.26 % | Chg in DII Hold | 0.52 % | PAT Qtr | 99.0 Cr. | PAT Prev Qtr | -30.0 Cr. |
| RSI | 42.9 | MACD | -10.5 | Volume | 25,223 | Avg Vol 1Wk | 70,086 |
| Low price | 764 ₹ | High price | 1,392 ₹ | PEG Ratio | 191 | Debt to equity | 6.26 |
| 52w Index | 34.4 % | Qtr Profit Var | -35.1 % | EPS | 0.03 ₹ | Industry PE | 22.8 |
📊 Core Financials
- Revenue & Profit Growth: Quarterly PAT improved to 99 Cr. from a loss of -30 Cr., but YoY profit variation is -35.1%, showing weak consistency.
- Margins: ROE at 9.04% and ROCE at 8.13% reflect low profitability compared to industry peers.
- Debt Ratios: Debt-to-equity at 6.26 indicates very high leverage, raising financial risk.
- Cash Flows: Cash generation is constrained by high debt servicing and weak earnings.
- Return Metrics: EPS at 0.03 ₹ is extremely low relative to price, highlighting valuation concerns.
💹 Valuation Indicators
- P/E Ratio: 35,829, abnormally high due to negligible EPS, making valuation unattractive.
- P/B Ratio: ~18.6 (Current Price / Book Value), reflecting expensive valuation relative to assets.
- PEG Ratio: 191, extremely high, showing poor growth-adjusted valuation.
- Intrinsic Value: Current price (980 ₹) appears significantly overvalued; downside risk remains unless profitability improves.
🏢 Business Model & Competitive Advantage
- Diversified conglomerate with exposure to multiple sectors including real estate, consumer goods, and industrials.
- Competitive advantage lies in brand legacy and diversified holdings, but profitability is under pressure.
- High debt levels weaken resilience and limit growth opportunities.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Safer accumulation range between 850 ₹ – 900 ₹ (closer to support levels and below DMA 200).
- Long-Term Holding: Suitable only for high-risk investors; improvement in debt management and profitability is critical before long-term holding.
Positive
- Turnaround from loss (-30 Cr.) to profit (99 Cr.) in the latest quarter.
- Strong brand legacy and diversified business portfolio.
- Domestic institutional inflows (+0.52%) show some local confidence.
Limitation
- Extremely high debt-to-equity ratio (6.26).
- Abnormally high P/E and PEG ratios indicate poor valuation metrics.
- Low ROE and ROCE compared to industry standards.
- No dividend yield, reducing investor appeal.
Company Negative News
- Reduction in FII holdings (-0.26%) shows cautious foreign investor sentiment.
- Weak technical indicators (RSI 42.9, MACD -10.5) reflect bearish momentum.
Company Positive News
- Quarterly turnaround from loss to profit.
- Rising DII inflows (+0.52%) support stock stability.
Industry
- Diversified conglomerates face cyclical risks but benefit from exposure to multiple sectors.
- Industry PE at 22.8 reflects moderate optimism and fair valuations.
Conclusion
- Godrej Industries shows weak fundamentals with high debt and poor valuation metrics.
- Turnaround in profitability is encouraging but sustainability remains uncertain.
- Best suited for high-risk investors; safer entry near lower support levels with close monitoring of debt reduction and earnings improvement.
I can also prepare a comparison with other conglomerates like Aditya Birla Capital or Reliance to highlight how Godrej Industries stacks up in terms of leverage and profitability.