GRANULES - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.7
| Stock Code | GRANULES | Market Cap | 17,338 Cr. | Current Price | 700 ₹ | High / Low | 731 ₹ |
| Stock P/E | 42.3 | Book Value | 178 ₹ | Dividend Yield | 0.21 % | ROCE | 12.8 % |
| ROE | 10.5 % | Face Value | 1.00 ₹ | DMA 50 | 629 ₹ | DMA 200 | 575 ₹ |
| Chg in FII Hold | 1.76 % | Chg in DII Hold | -0.46 % | PAT Qtr | 99.0 Cr. | PAT Prev Qtr | 112 Cr. |
| RSI | 73.1 | MACD | 25.8 | Volume | 18,27,818 | Avg Vol 1Wk | 27,21,229 |
| Low price | 431 ₹ | High price | 731 ₹ | PEG Ratio | -6.60 | Debt to equity | 0.19 |
| 52w Index | 89.6 % | Qtr Profit Var | 36.1 % | EPS | 16.2 ₹ | Industry PE | 30.1 |
📊 Financials: GRANULES shows moderate fundamentals with ROE at 10.5% and ROCE at 12.8%, reflecting average efficiency. EPS at ₹16.2 supports earnings but remains modest relative to price levels. Quarterly PAT declined to ₹99 Cr. from ₹112 Cr., raising concerns about earnings consistency. Debt-to-equity at 0.19 indicates manageable leverage.
💹 Valuation: Current P/E of 42.3 is above the industry average of 30.1, suggesting overvaluation. PEG ratio of -6.60 highlights weak growth prospects. Book value of ₹178 vs. CMP ₹700 shows a steep P/B multiple, justified only by momentum and sectoral positioning.
🏗️ Business Model: GRANULES operates in pharmaceuticals with a focus on bulk drugs and formulations. Its competitive advantage lies in cost-efficient manufacturing and global supply chain presence, but profitability metrics remain weaker than peers.
📈 Entry Zone: Accumulation near ₹630–₹650 (close to DMA50 support) offers favorable risk-reward. RSI at 73.1 indicates overbought conditions, while MACD at 25.8 shows bullish momentum. Exit strategy near ₹720–₹730 with stop-loss around ₹610.
🕰️ Long-Term Holding: While GRANULES benefits from sectoral demand and institutional inflows, weak fundamentals and overvaluation limit aggressive long-term upside. Suitable for cautious investors seeking pharma exposure with moderate risk.
Positive
- Debt-to-equity ratio at 0.19 ensures stability
- Incremental increase in FII holdings (+1.76%)
- Stock trading near 52-week high (89.6% index)
- Strong quarterly profit variation (+36.1%)
Limitation
- Quarterly PAT decline (₹112 Cr. → ₹99 Cr.)
- Weak ROE (10.5%) and ROCE (12.8%)
- Negative PEG ratio (-6.60) signals poor growth outlook
- P/E (42.3) above industry average (30.1)
- DII holdings decreased (-0.46%)
Company Negative News
- Profit decline in recent quarter
- Valuation concerns with P/E above peers
Company Positive News
- Strong profit variation (+36.1%)
- FII inflows (+1.76%) support momentum
Industry
- Pharma industry P/E at 30.1 reflects premium valuations
- Sector supported by global demand and defensive positioning
Conclusion
GRANULES is financially stable with low debt and institutional support, but weak efficiency metrics and overvaluation limit upside. Entry near ₹630–₹650 is favorable, with profit booking advised near ₹720–₹730. Best suited for cautious investors seeking pharma exposure with moderate risk.