GRAPHITE - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | GRAPHITE | Market Cap | 13,815 Cr. | Current Price | 707 ₹ | High / Low | 760 ₹ |
| Stock P/E | 32.9 | Book Value | 287 ₹ | Dividend Yield | 1.56 % | ROCE | 10.3 % |
| ROE | 8.26 % | Face Value | 2.00 ₹ | DMA 50 | 666 ₹ | DMA 200 | 607 ₹ |
| Chg in FII Hold | 0.27 % | Chg in DII Hold | 0.47 % | PAT Qtr | 121 Cr. | PAT Prev Qtr | 92.0 Cr. |
| RSI | 56.1 | MACD | 25.2 | Volume | 21,52,904 | Avg Vol 1Wk | 15,02,088 |
| Low price | 421 ₹ | High price | 760 ₹ | PEG Ratio | -4.28 | Debt to equity | 0.03 |
| 52w Index | 84.4 % | Qtr Profit Var | 3,920 % | EPS | 20.4 ₹ | Industry PE | 37.3 |
📊 Financials: GRAPHITE shows moderate fundamentals with ROE at 8.26% and ROCE at 10.3%, reflecting weak efficiency compared to peers. EPS at ₹20.4 supports earnings but remains modest relative to valuation. Quarterly PAT surged to ₹121 Cr. from ₹92 Cr., indicating strong short-term growth momentum. Debt-to-equity at 0.03 highlights a nearly debt-free balance sheet.
💹 Valuation: Current P/E of 32.9 is slightly below the industry average of 37.3, suggesting fair valuation. However, PEG ratio of -4.28 signals poor growth prospects. Book value of ₹287 vs. CMP ₹707 shows a reasonable P/B multiple, supported by operational stability.
🏗️ Business Model: GRAPHITE operates in graphite electrode manufacturing, serving steel and industrial sectors. Its competitive advantage lies in global demand for electrodes, but cyclical industry exposure and weak efficiency metrics limit upside.
📈 Entry Zone: Accumulation near ₹660–₹670 (close to DMA50 support) offers favorable risk-reward. RSI at 56.1 indicates neutral momentum, while MACD at 25.2 shows bullish strength. Exit strategy near ₹740–₹760 with stop-loss around ₹640.
🕰️ Long-Term Holding: While debt-free status and sectoral demand support stability, weak efficiency and negative PEG ratio limit long-term attractiveness. Suitable for cautious investors seeking cyclical exposure with moderate risk.
Positive
- Debt-to-equity ratio at 0.03 ensures stability
- Quarterly PAT growth (₹92 Cr. → ₹121 Cr.)
- Incremental increase in FII (+0.27%) and DII (+0.47%) holdings
- Stock trading near 52-week high (84.4% index)
Limitation
- Weak ROE (8.26%) and ROCE (10.3%)
- Negative PEG ratio (-4.28) signals poor growth outlook
- EPS (₹20.4) modest relative to valuation
Company Negative News
- No major negative news reported; growth concerns persist due to weak efficiency metrics
Company Positive News
- Quarterly profit growth (+3,920%)
- Institutional inflows from both FII and DII
Industry
- Steel and industrial sector demand supports electrode consumption
- Industry P/E at 37.3 reflects premium valuations
Conclusion
GRAPHITE is financially stable with low debt and strong quarterly profit growth, but weak efficiency and negative PEG ratio limit long-term appeal. Entry near ₹660–₹670 is favorable, with profit booking advised near ₹740–₹760. Best suited for cautious investors seeking cyclical exposure with moderate risk.