MARICO - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.4

📊 Core Financials Analysis

Profit Growth: PAT surged from ₹325 Cr to ₹777 Cr — a 150% jump, indicating strong operational leverage and margin expansion.

Return Metrics

ROCE: 42.8% — exceptional capital efficiency.

ROE: 36.5% — outstanding shareholder return.

Debt Profile: Debt-to-equity of 0.06 — virtually debt-free, ensuring financial flexibility.

Cash Flow: While not explicitly stated, high profitability and low debt imply robust operating cash flows.

💹 Valuation Indicators

Metric Value Commentary

P/E Ratio 46.5 Richly valued vs. industry PE of 29.3 — reflects premium positioning.

P/B Ratio ~19.6 High, but justified by superior ROE and brand equity.

PEG Ratio 4.92 Elevated — suggests valuation may be stretched relative to growth.

EPS ₹15.5 Solid earnings base supports valuation.

🧠 Business Model & Competitive Advantage

Marico is a leading FMCG player with a stronghold in health, beauty, and wellness

Core Brands

Parachute: 63% market share in branded coconut oil — contributes 38% of India revenue.

Saffola: 41% market share in premium edible oils — contributes 26% of revenue

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International Footprint: Active in 25+ countries, with Bangladesh alone contributing ~11–12% of total revenue

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Diversification: Expanding into health foods, male grooming, and personal care — building resilience beyond core categories.

Strategic Focus: Steady consumer-driven growth rather than trend-chasing — a disciplined approach that has paid off

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Sustainability & Recognition: Awarded for water management and ESG practices

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Its competitive edge lies in brand dominance, distribution reach, and consumer loyalty, especially in niche categories where competition is lower.

📈 Technical & Sentiment Signals

RSI: 46.4 — neutral zone, no immediate overbought/oversold signal.

MACD: Slightly positive — mild bullish momentum.

Volume: Slightly below average — suggests consolidation.

DMA 50/200: Price hovering near both — stable trend.

🎯 Entry Zone & Long-Term Guidance

Suggested Entry Zone: ₹690–₹710 — near DMA levels and below recent highs.

Long-Term View: Marico is a high-quality, brand-led FMCG play with strong fundamentals and global reach. Suitable for long-term holding, especially for investors seeking steady growth, low debt, and defensive sector exposure. Dividend yield of 1.46% adds modest income support.

If you'd like, I can help you compare Marico with peers like Dabur or Emami to sharpen your view.

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www.kotaksecurities.com

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marico.com

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