⚠ 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.
KAJARIACER - Fundamental Analysis: Financial Health & Valuation
Last Updated Time : 05 Nov 25, 7:43 am
Back to Fundamental ListFundamental Rating: 3.7
📊 Financial Overview
- Profitability: PAT increased from ₹99.7 Cr to ₹121 Cr QoQ, showing a solid 30% growth.
- Return Metrics: ROE at 10.8% and ROCE at 16.8% reflect healthy but not exceptional capital efficiency.
- Valuation: P/E of 58.4 is significantly above the industry average (44.1), indicating a premium valuation.
- P/B Ratio: With a book value of ₹174 and price of ₹1,206, the P/B ratio is ~6.93, suggesting a high valuation multiple.
- PEG Ratio: -7.13 signals earnings contraction or valuation distortion.
- Debt Profile: Debt-to-equity ratio of 0.04 shows strong financial discipline and minimal leverage.
- Momentum: RSI at 49.1 and MACD at 0.53 indicate neutral sentiment with potential for upside.
🏢 Business Model & Competitive Edge
- Kajaria Ceramics is India’s largest tile manufacturer, with a strong brand and extensive retail and dealer network.
- Focus on premium products and exports enhances margins and global visibility.
- Operational efficiency and backward integration support cost control and scalability.
💡 Entry Zone Recommendation
- Current price is near DMA 50 (₹1,212) and above DMA 200 (₹1,145), indicating consolidation.
- Suggested Entry Zone: ₹1,160–₹1,190 for accumulation.
- Long-term holding is favorable given brand strength and consistent profitability.
✅ Positive
- Strong QoQ PAT growth and consistent earnings performance.
- Low debt-to-equity ratio enhances financial resilience.
- Dominant market position in ceramic and vitrified tiles.
⚠️ Limitation
- High P/E and P/B ratios suggest valuation concerns.
- Negative PEG ratio indicates earnings contraction or valuation misalignment.
- ROE could be stronger for a premium consumer brand.
📉 Company Negative News
- FII holdings declined by 0.98% and DII by 1.39%, reflecting cautious institutional sentiment.
- Stock has corrected ~9% from its 52-week high of ₹1,322.
📈 Company Positive News
- Strong quarterly earnings and stable operating margins.
- Continued expansion in export markets and premium product segments.
🏭 Industry
- Building materials sector benefits from real estate recovery and infrastructure push.
- Industry P/E of 44.1 supports moderate valuation for quality players.
🧾 Conclusion
- Kajaria Ceramics is a market leader with strong fundamentals and brand equity, trading at a premium.
- Entry near ₹1,160–₹1,190 offers a reasonable long-term opportunity.
- Monitor valuation metrics and institutional flows for sustained performance.
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