MRF - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.2

📊 Core Financials Analysis

Profitability

PAT: ₹484 Cr this quarter vs ₹498 Cr previous — slight dip, but still robust.

EPS: ₹4,113 — exceptionally high, reflecting strong earnings per share.

Return Metrics

ROCE: 13.8% — decent, though not industry-leading.

ROE: 10.5% — moderate, suggesting room for efficiency improvement.

Debt Profile: Debt-to-equity of 0.13 — low leverage, indicating financial prudence.

Cash Flow: Not explicitly provided, but consistent profitability and low debt imply healthy operating cash flows.

💹 Valuation Indicators

Metric Value Commentary

P/E Ratio 36.2 Slightly above industry average (33.2) — priced for quality.

P/B Ratio ~3.48 Reasonable given brand strength and asset base.

PEG Ratio 0.71 Fairly attractive — growth-adjusted valuation is favorable.

Intrinsic Value Likely close to current price Premium justified by brand and market leadership.

🧠 Business Model & Competitive Advantage

MRF is India’s largest tyre manufacturer, with a diversified portfolio that includes

Automobile Tyres: Core segment, contributing over 90% of revenue

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Other Segments: Paints, sports goods, conveyor belts — minor but strategic diversification

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Global Reach: Products sold in over 60 countries, with exports to 120 nations

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Brand Strength: Ranked among the world’s top tyre brands with AAA− grade

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R&D Focus: Strong investment in innovation and product quality — key to maintaining leadership

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Its competitive edge lies in brand loyalty, wide product range, and technological innovation, allowing it to command premium pricing and maintain resilience across cycles.

📈 Technical & Sentiment Indicators

RSI: 53.8 — neutral zone, no immediate overbought/oversold signal.

MACD: Positive — bullish momentum.

DMA 50/200: Price above both — confirms long-term uptrend.

Volume: Below average — suggests consolidation or low speculative interest.

🎯 Entry Zone & Long-Term Guidance

Suggested Entry Zone: ₹1,45,000–₹1,47,500 — near DMA 50 and below recent highs.

Long-Term View: MRF is a premium-quality stock with strong fundamentals, brand equity, and global reach. Suitable for long-term holding, especially for investors seeking stability and moderate growth in the auto ancillary space.

If you'd like, I can also help you compare MRF with Apollo Tyres or Balkrishna Industries to sharpen your investment thesis.

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