ITI - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.4
| Stock Code | ITI | Market Cap | 28,787 Cr. | Current Price | 299 ₹ | High / Low | 373 ₹ |
| Book Value | 15.1 ₹ | Dividend Yield | 0.00 % | ROCE | -1.33 % | ROE | -16.2 % |
| Face Value | 10.0 ₹ | DMA 50 | 283 ₹ | DMA 200 | 293 ₹ | Chg in FII Hold | 0.00 % |
| Chg in DII Hold | 0.01 % | PAT Qtr | -21.0 Cr. | PAT Prev Qtr | -52.5 Cr. | RSI | 58.2 |
| MACD | 9.08 | Volume | 6,09,228 | Avg Vol 1Wk | 10,60,268 | Low price | 233 ₹ |
| High price | 373 ₹ | Debt to equity | 0.90 | 52w Index | 47.1 % | Qtr Profit Var | 68.7 % |
| EPS | -1.54 ₹ | Industry PE | 53.8 |
Core Financials:
ITI shows weak fundamentals. ROE is negative (-16.2%) and ROCE also negative (-1.33%), reflecting poor efficiency. EPS is negative at -₹1.54, and quarterly PAT remains in loss (-₹21 Cr vs -₹52.5 Cr). Debt-to-equity is moderate at 0.90, but profitability remains a major concern.
Valuation:
No valid P/E due to negative earnings. Price-to-book is ~19.8, extremely expensive relative to intrinsic value. PEG ratio unavailable, making growth alignment unclear. Dividend yield is nil (0.00%), offering no income support.
Business Model & Health:
ITI operates in telecom and electronics manufacturing with government-linked projects. Competitive advantage lies in legacy infrastructure and government support. However, persistent losses, weak profitability, and stretched valuations undermine overall health.
Entry Zone:
Ideal entry zone: ₹240–₹260. Current price ₹299 is above fair entry. Long-term holding is risky unless profitability improves significantly.
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Positive
- Quarterly losses narrowed (₹-21 Cr vs ₹-52.5 Cr)
- Technicals show mild bullishness: RSI 58.2, MACD 9.08
- DII holdings increased slightly (+0.01%)
Limitation
- Negative ROE (-16.2%) and ROCE (-1.33%)
- EPS negative (-₹1.54)
- No dividend yield
- Price-to-book (~19.8) extremely expensive
- Volume below weekly average
Company Negative News
- Persistent losses despite narrowing trend
- Weak fundamentals with negative profitability ratios
- Valuation concerns due to lack of earnings
Company Positive News
- Loss reduction quarter-on-quarter
- Technical momentum improving with RSI and MACD signals
Industry
Telecom/electronics sector trades at industry P/E of 53.8, supported by digital infrastructure growth. ITI lags peers due to negative earnings and weak fundamentals, making valuation comparisons unreliable.
Conclusion
ITI is fundamentally weak with negative profitability and stretched valuations. Rating: 2.4. Entry near ₹240–₹260 is preferable for speculative investors. Long-term holding is risky unless profitability improves. Exit strategy around ₹350–₹370 if fundamentals stagnate.
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