MRF - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | MRF | Market Cap | 55,012 Cr. | Current Price | 1,29,710 ₹ | High / Low | 1,63,600 ₹ |
| Stock P/E | 24.7 | Book Value | 45,019 ₹ | Dividend Yield | 0.18 % | ROCE | 13.8 % |
| ROE | 10.5 % | Face Value | 10.0 ₹ | DMA 50 | 1,35,871 ₹ | DMA 200 | 1,41,006 ₹ |
| Chg in FII Hold | -0.20 % | Chg in DII Hold | -0.25 % | PAT Qtr | 736 Cr. | PAT Prev Qtr | 512 Cr. |
| RSI | 40.4 | MACD | -848 | Volume | 8,404 | Avg Vol 1Wk | 8,612 |
| Low price | 1,23,430 ₹ | High price | 1,63,600 ₹ | PEG Ratio | 0.49 | Debt to equity | 0.11 |
| 52w Index | 15.6 % | Qtr Profit Var | 140 % | EPS | 5,123 ₹ | Industry PE | 24.0 |
📊 MRF shows moderate fundamentals with a market cap of ₹55,012 Cr. and current price of ₹1,29,710, trading well below its 200 DMA (₹1,41,006). Efficiency metrics are modest — ROE at 10.5% and ROCE at 13.8% — while valuation is fair with a P/E of 24.7 compared to the industry average of 24.0. EPS at ₹5,123 is strong, supported by quarterly PAT growth (+140%). Debt-to-equity at 0.11 reflects financial stability. However, technical indicators (RSI 40.4, MACD negative) suggest weakness. PEG ratio at 0.49 indicates reasonable growth-adjusted valuation, but institutional flows are negative (FII -0.20%, DII -0.25%).
💡 Entry Zone: ₹1,25,000–₹1,30,000 (near recent low and support levels)
📈 Long-Term Holding: Suitable for patient investors, but stronger returns depend on improvement in ROE/ROCE. Accumulation on dips is recommended for a 3–5 year horizon.
✅ Positive
- Quarterly PAT growth (+140%) shows strong earnings momentum
- EPS of ₹5,123 reflects strong earnings power
- Low debt-to-equity ratio (0.11) indicates financial stability
- Valuation fair compared to industry average (P/E 24.7 vs 24.0)
⚠️ Limitation
- ROE (10.5%) and ROCE (13.8%) are modest, limiting compounding potential
- Dividend yield at 0.18% is unattractive for income investors
- Technical indicators (RSI 40.4, MACD -848) suggest near-term weakness
- Institutional investors reducing holdings (FII -0.20%, DII -0.25%)
📉 Company Negative News
- Decline in institutional investor confidence
- Stock trading below DMA 200, showing long-term weakness
📈 Company Positive News
- Quarterly profit growth from ₹512 Cr → ₹736 Cr
- Strong EPS supports valuation stability
🏭 Industry
- Tyre and automotive sector benefits from rising vehicle demand
- Industry P/E at 24.0 suggests MRF is fairly valued
🔎 Conclusion
MRF is a fundamentally stable company with strong earnings but moderate efficiency metrics. Entry near ₹1,25,000–₹1,30,000 offers a better risk-reward setup. Long-term investors should accumulate cautiously and reassess holding if ROE/ROCE improve beyond 15% with sustained profitability.