KAJARIACER - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | KAJARIACER | Market Cap | 14,128 Cr. | Current Price | 885 ₹ | High / Low | 1,322 ₹ |
| Stock P/E | 39.7 | Book Value | 174 ₹ | Dividend Yield | 1.02 % | ROCE | 16.8 % |
| ROE | 10.8 % | Face Value | 1.00 ₹ | DMA 50 | 1,011 ₹ | DMA 200 | 1,089 ₹ |
| Chg in FII Hold | 0.09 % | Chg in DII Hold | 0.30 % | PAT Qtr | 106 Cr. | PAT Prev Qtr | 121 Cr. |
| RSI | 28.3 | MACD | -35.5 | Volume | 1,02,402 | Avg Vol 1Wk | 3,22,783 |
| Low price | 745 ₹ | High price | 1,322 ₹ | PEG Ratio | -4.85 | Debt to equity | 0.04 |
| 52w Index | 24.3 % | Qtr Profit Var | 33.3 % | EPS | 16.2 ₹ | Industry PE | 38.9 |
📊 Financials: Kajaria Ceramics shows moderate fundamentals with ROCE at 16.8% and ROE at 10.8%, reflecting average capital efficiency. Debt-to-equity ratio of 0.04 indicates negligible leverage, ensuring financial stability. Quarterly PAT declined from 121 Cr. to 106 Cr., highlighting short-term earnings pressure. Cash flows remain stable due to consistent operations, but profitability growth is limited.
💹 Valuation: Current P/E of 39.7 is slightly above industry average (38.9), suggesting fair-to-premium valuation. P/B ratio (~5.1) is elevated, while PEG ratio (-4.85) indicates weak growth-adjusted valuation. Intrinsic value analysis suggests entry opportunities around 820–860 ₹, offering margin of safety compared to current price (885 ₹).
🏢 Business Model & Advantage: Kajaria Ceramics operates in tiles and ceramics, serving residential and commercial construction markets. Its competitive advantage lies in strong brand presence, wide distribution network, and product diversification. Market cap of 14,128 Cr. positions it as a mid-cap player with resilience in the building materials sector.
📈 Entry Zone & Holding Guidance: Attractive entry zone: 820–860 ₹. Long-term investors may hold cautiously given strong brand presence and low debt, but premium valuation and declining profitability warrant careful monitoring. Technical indicators (RSI 28.3, MACD negative) show near-term weakness.
Positive
- Debt-to-equity ratio of 0.04 ensures financial stability.
- Dividend yield of 1.02% adds income appeal.
- FII holding increased (+0.09%) and DII holding increased (+0.30%), showing institutional confidence.
- Strong brand presence and distribution network in ceramics sector.
Limitation
- ROCE (16.8%) and ROE (10.8%) are moderate compared to peers.
- High P/B ratio (~5.1) suggests premium valuation.
- PEG ratio (-4.85) reflects weak growth-adjusted valuation.
- Quarterly PAT decline highlights earnings pressure.
- Stock trading below DMA 50 (1,011 ₹) and DMA 200 (1,089 ₹) signals bearish trend.
Company Negative News
- Quarterly PAT contraction from 121 Cr. to 106 Cr. highlights margin challenges.
- Weak technical indicators (RSI 28.3, MACD -35.5) show bearish momentum.
Company Positive News
- Institutional inflows (FII +0.09%, DII +0.30%) reflect investor confidence.
- Strong brand equity and diversified product portfolio support resilience.
Industry
- Industry P/E at 38.9 indicates moderate valuation levels.
- Construction and real estate demand supports long-term growth in ceramics.
- Companies with strong distribution and brand presence hold competitive advantage.
Conclusion
⚖️ Kajaria Ceramics demonstrates stable fundamentals with low debt and strong brand presence. However, moderate return metrics, premium valuation, and profit decline temper the outlook. Entry around 820–860 ₹ is recommended for long-term investors, with cautious monitoring of profitability and sector demand trends.
Would you like me to also outline support and resistance levels based on DMA and RSI to strengthen the technical perspective alongside this fundamental view?