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PCBL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.0
| Stock Code | PCBL | Market Cap | 10,295 Cr. | Current Price | 261 ₹ | High / Low | 444 ₹ |
| Stock P/E | 28.7 | Book Value | 103 ₹ | Dividend Yield | 2.29 % | ROCE | 13.2 % |
| ROE | 12.8 % | Face Value | 1.00 ₹ | DMA 50 | 298 ₹ | DMA 200 | 350 ₹ |
| Chg in FII Hold | -0.40 % | Chg in DII Hold | -0.57 % | PAT Qtr | 59.6 Cr. | PAT Prev Qtr | 93.1 Cr. |
| RSI | 34.8 | MACD | -11.1 | Volume | 3,83,925 | Avg Vol 1Wk | 8,38,351 |
| Low price | 254 ₹ | High price | 444 ₹ | PEG Ratio | 17.5 | Debt to equity | 0.77 |
| 52w Index | 3.66 % | Qtr Profit Var | -53.8 % | EPS | 9.50 ₹ | Industry PE | 30.7 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT declined from ₹93.1 Cr. to ₹59.6 Cr. (-53.8%), showing pressure on margins. EPS at ₹9.50 remains modest.
- Return Metrics: ROE at 12.8% and ROCE at 13.2% indicate average capital efficiency, neither weak nor outstanding.
- Debt Position: Debt-to-equity ratio at 0.77 reflects relatively high leverage compared to peers, raising risk in downturns.
- Cash Flow: Dividend yield of 2.29% provides moderate shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 28.7, slightly below industry average of 30.7, suggesting fair valuation.
- P/B Ratio: Current Price ₹261 vs. Book Value ₹103 → ~2.5, trading at a premium to book value.
- PEG Ratio: 17.5, very high, indicating poor growth-adjusted valuation.
- Intrinsic Value: Current valuation appears stretched given declining profits and high leverage.
🏭 Business Model & Competitive Advantage
- PCBL operates in carbon black manufacturing, a key input for tire and rubber industries.
- Competitive advantage lies in scale and established customer relationships, but cyclical demand and raw material costs impact profitability.
- Industry dependence on auto sector cycles adds volatility to earnings.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between ₹250–270, closer to 52-week low.
- Long-Term Holding: Suitable for investors seeking cyclical exposure; long-term holding requires patience and monitoring of auto sector demand and debt levels.
Positive
- Dividend yield at 2.29% provides steady returns.
- ROE (12.8%) and ROCE (13.2%) show moderate efficiency.
- Stock trading near RSI 34.8, indicating oversold condition and potential rebound.
Limitation
- Quarterly PAT declined sharply (-53.8%).
- High debt-to-equity ratio (0.77) increases financial risk.
- PEG ratio at 17.5 suggests poor growth-adjusted valuation.
- Stock trading below DMA 50 (₹298) and DMA 200 (₹350), showing bearish trend.
Company Negative News
- Decline in quarterly profits.
- FII holdings reduced (-0.40%) and DII holdings reduced (-0.57%), showing lower institutional confidence.
- MACD negative (-11.1), signaling bearish momentum.
Company Positive News
- Dividend yield supports investor sentiment.
- RSI oversold, potential for technical rebound.
Industry
- Carbon black industry P/E at 30.7, slightly higher than PCBL’s 28.7, suggesting fair valuation.
- Sector outlook tied to auto and tire demand cycles, with volatility in raw material costs.
Conclusion
- PCBL shows moderate efficiency and dividend support but faces declining profits and high leverage.
- Valuation is fair relative to peers, but growth-adjusted metrics are weak.
- Accumulation near ₹250–270 may be considered for cyclical exposure, with cautious long-term outlook.
I can also prepare a peer comparison with other carbon black or specialty chemical companies to highlight how PCBL stacks up in terms of valuation, profitability, and debt profile. Would you like me to set that up?