MRPL - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 2.1

Let’s analyze MRPL (Mangalore Refinery and Petrochemicals Ltd) from both a numbers and strategic angle

📊 Core Financials

ROE: 0.43% and ROCE: 4.33% — very weak return metrics; capital isn’t being deployed effectively.

EPS: ₹-1.64 — negative earnings, which reflects a loss-making quarter and weak profitability.

Quarterly PAT: Huge swing from ₹371 Cr. profit to ₹-271 Cr. loss; Profit Variation: -470% — indicative of high volatility in earnings.

Debt-to-Equity: 1.01 — moderate leverage; while manageable, it adds strain in downturns.

Dividend Yield: 2.28% — provides some income cushion, though sustainability is questionable if losses persist.

📈 Valuation Indicators

Metric Value Insight

P/E Ratio Not available Reflects negative earnings

P/B Ratio ~1.77 Fair-to-slightly elevated given modest book value and weak returns

PEG Ratio Not available Cannot be calculated due to lack of earnings growth

Industry PE 21.6 MRPL significantly lags behind — showing sector underperformance

🏭 Business Model & Competitive Standing

MRPL operates in refining and downstream petroleum — a sector highly exposed to crude price volatility, regulatory controls, and global macroeconomic cycles.

Lacks integrated operations like upstream assets or retail networks, unlike peers such as Reliance or IOCL.

Earnings are cyclical, dependent on Gross Refining Margins (GRM) and inventory valuation — recent swings suggest stress on both fronts.

Competitive edge is minimal due to operational limitations and regional scale.

📉 Technical Overview

RSI: 39.0 — nearing oversold; technical relief bounce possible.

MACD: -0.71 — momentum is weak; trend bias is still bearish.

Price below 50-DMA (₹142) and 200-DMA (₹145) — clear downtrend unless volume spikes reverse the weakness.

🛒 Entry Zone & Investment Thesis

Suggested Entry Zone: ₹120–₹125 — closer to base formation and risk-adjusted levels.

Long-Term Holding: Not ideal unless you're betting on a sharp GRM recovery or policy tailwinds. High earnings variability, sector cyclicality, and lack of a pricing moat make this a speculative, turnaround-oriented play.

Would you like me to compare it with Chennai Petroleum or HPCL to explore broader refining sector dynamics? That could offer some clearer positioning.

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