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KEI - Fundamental Analysis: Financial Health & Valuation
Last Updated Time : 05 Nov 25, 7:43 am
Back to Fundamental ListFundamental Rating: 4.1
📊 Financial Overview
- Profitability: PAT increased from ₹196 Cr to ₹204 Cr QoQ, showing a healthy 31.5% growth YoY.
- Return Metrics: ROE at 15.6% and ROCE at 21.3% reflect strong capital efficiency and operational performance.
- Valuation: P/E of 48.7 is nearly double the industry average (24.5), indicating premium valuation.
- P/B Ratio: With a book value of ₹647 and price of ₹4,028, P/B is ~6.2, suggesting a fair premium.
- PEG Ratio: 2.14 signals overvaluation relative to earnings growth.
- Debt Profile: Debt-to-equity ratio of 0.04 shows excellent financial discipline and minimal leverage.
- Momentum: RSI at 48.0 and MACD at -2.87 suggest neutral to slightly bearish sentiment.
🏢 Business Model & Competitive Edge
- KEI Industries is a leading manufacturer of cables and wires, serving power, infrastructure, and industrial sectors.
- Strong brand recall, diversified product portfolio, and pan-India distribution network offer competitive advantages.
- Focus on exports and institutional sales supports long-term scalability and margin expansion.
💡 Entry Zone Recommendation
- Current price is slightly below DMA 50 (₹4,079) and above DMA 200 (₹3,850), indicating consolidation.
- Suggested Entry Zone: ₹3,850–₹4,000 for accumulation.
- Long-term holding is favorable given strong fundamentals and sectoral tailwinds.
✅ Positive
- Strong ROE and ROCE indicate efficient capital deployment.
- Low debt-to-equity ratio enhances financial resilience.
- DII holdings increased by 1.08%, showing rising domestic investor confidence.
⚠️ Limitation
- High P/E and PEG ratios suggest valuation concerns.
- FII holdings declined by 0.77%, indicating cautious foreign sentiment.
- Dividend yield of 0.10% may not appeal to income-focused investors.
📉 Company Negative News
- Stock has corrected ~14% from its 52-week high of ₹4,706.
- MACD and RSI indicate weak short-term momentum.
📈 Company Positive News
- Strong PAT growth and consistent earnings performance.
- Expansion in export markets and institutional sales gaining traction.
🏭 Industry
- Electrical infrastructure and industrial capex are driving demand for cables and wires.
- Industry P/E of 24.5 supports moderate valuation for growth-oriented players.
🧾 Conclusion
- KEI Industries is a fundamentally strong player with robust financials and strategic growth initiatives.
- Entry near ₹3,850–₹4,000 offers a favorable long-term opportunity.
- Monitor valuation metrics and institutional flows for sustained performance.
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