MEDANTA - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | MEDANTA | Market Cap | 30,037 Cr. | Current Price | 1,117 ₹ | High / Low | 1,456 ₹ |
| Stock P/E | 60.0 | Book Value | 141 ₹ | Dividend Yield | 0.04 % | ROCE | 19.6 % |
| ROE | 15.2 % | Face Value | 2.00 ₹ | DMA 50 | 1,091 ₹ | DMA 200 | 1,162 ₹ |
| Chg in FII Hold | -0.39 % | Chg in DII Hold | 0.77 % | PAT Qtr | 107 Cr. | PAT Prev Qtr | 128 Cr. |
| RSI | 56.2 | MACD | 20.4 | Volume | 2,92,096 | Avg Vol 1Wk | 1,98,268 |
| Low price | 955 ₹ | High price | 1,456 ₹ | PEG Ratio | 1.90 | Debt to equity | 0.07 |
| 52w Index | 32.3 % | Qtr Profit Var | -18.4 % | EPS | 17.3 ₹ | Industry PE | 47.1 |
📊 Financials: MEDANTA shows decent fundamentals with ROE at 15.2% and ROCE at 19.6%, reflecting moderate efficiency. Debt-to-equity at 0.07 indicates low leverage. EPS at ₹17.3 is modest relative to price levels. Quarterly PAT declined to ₹107 Cr. from ₹128 Cr., raising concerns about earnings momentum.
💹 Valuation: Current P/E of 60.0 is significantly higher than the industry average of 47.1, suggesting overvaluation. PEG ratio of 1.90 indicates growth is expensive. Book value of ₹141 vs. CMP ₹1,117 highlights a steep P/B multiple, justified only by sectoral demand and institutional support.
🏗️ Business Model: MEDANTA operates in healthcare services with strong brand recognition and diversified hospital operations. Its competitive advantage lies in specialized medical expertise, infrastructure, and growing demand for healthcare services in India.
📈 Entry Zone: Accumulation near ₹1,105–₹1,120 (close to 50 DMA support) offers favorable risk-reward. RSI at 56.2 indicates neutral momentum, while MACD at 20.4 shows mild bullishness. Exit strategy near ₹1,145–₹1,165 with stop-loss around ₹1,090.
🕰️ Long-Term Holding: While fundamentals are stable, high valuation and declining profits limit upside. Suitable for cautious long-term investors seeking healthcare exposure, but not ideal for aggressive growth portfolios.
Positive
- Low debt-to-equity ratio (0.07)
- Moderate ROE (15.2%) and ROCE (19.6%)
- Strong institutional support from DII (+0.77%)
- Healthcare sector demand provides long-term visibility
Limitation
- High P/E (60.0) vs. industry average (47.1)
- Quarterly PAT decline (₹128 Cr. → ₹107 Cr.)
- PEG ratio of 1.90 indicates expensive growth
- FII holding decreased (-0.39%)
Company Negative News
- No major negative news reported; earnings decline is the primary concern
Company Positive News
- Strong domestic institutional support (+0.77%)
- Stable fundamentals with low debt levels
Industry
- Healthcare industry P/E at 47.1 reflects premium valuations
- Sector supported by rising demand for medical services
Conclusion
MEDANTA is a cautious candidate with decent fundamentals and strong sectoral demand, but high valuation and declining profits limit upside potential. Entry near ₹1,105–₹1,120 is favorable, with profit booking advised near ₹1,145–₹1,165. Best suited for cautious investors seeking healthcare exposure with moderate risk.