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PGEL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.8
| Stock Code | PGEL | Market Cap | 15,454 Cr. | Current Price | 542 ₹ | High / Low | 1,008 ₹ |
| Stock P/E | 132 | Book Value | 91.9 ₹ | Dividend Yield | 0.05 % | ROCE | 6.83 % |
| ROE | 4.87 % | Face Value | 1.00 ₹ | DMA 50 | 568 ₹ | DMA 200 | 621 ₹ |
| Chg in FII Hold | -0.86 % | Chg in DII Hold | 3.83 % | PAT Qtr | 38.7 Cr. | PAT Prev Qtr | 31.8 Cr. |
| RSI | 43.5 | MACD | -13.1 | Volume | 13,20,103 | Avg Vol 1Wk | 24,90,007 |
| Low price | 465 ₹ | High price | 1,008 ₹ | PEG Ratio | 3.55 | Debt to equity | 0.02 |
| 52w Index | 14.1 % | Qtr Profit Var | 97.8 % | EPS | 4.14 ₹ | Industry PE | 24.6 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT improved from ₹31.8 Cr. to ₹38.7 Cr. (+97.8% YoY growth), but overall margins remain weak with EPS at ₹4.14.
- Return Metrics: ROE at 4.87% and ROCE at 6.83% highlight low capital efficiency.
- Debt Position: Debt-to-equity ratio at 0.02 shows negligible leverage, ensuring balance sheet stability.
- Cash Flow: Dividend yield at 0.05% is negligible, offering minimal shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 132, extremely high compared to industry average of 24.6, indicating severe overvaluation.
- P/B Ratio: Current Price ₹542 vs. Book Value ₹91.9 → ~5.9, trading at a steep premium.
- PEG Ratio: 3.55, expensive relative to growth prospects.
- Intrinsic Value: Current valuation appears inflated; intrinsic value likely lower than market price given weak returns.
🏭 Business Model & Competitive Advantage
- PGEL operates in consumer electronics and appliances, benefiting from rising demand in India’s middle-class segment.
- Competitive advantage lies in brand presence and distribution network, but profitability remains inconsistent.
- High valuation multiples suggest speculative interest rather than strong fundamentals.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between ₹460–500, closer to 52-week low.
- Long-Term Holding: Suitable only for speculative investors betting on consumer electronics growth; fundamentals do not justify aggressive long-term holding at current valuation.
Positive
- Quarterly PAT improved sequentially.
- Debt-to-equity ratio at 0.02 ensures negligible leverage risk.
- DII holdings increased (+3.83%), showing strong domestic institutional support.
Limitation
- Extremely high P/E ratio (132) compared to industry average (24.6).
- Low ROE (4.87%) and ROCE (6.83%).
- Dividend yield negligible at 0.05%.
- Stock trading below DMA 50 (₹568) and DMA 200 (₹621), indicating bearish trend.
Company Negative News
- FII holdings reduced (-0.86%), showing lower foreign investor confidence.
- MACD negative (-13.1), signaling bearish momentum.
Company Positive News
- Quarterly PAT improved from ₹31.8 Cr. to ₹38.7 Cr.
- DII holdings increased significantly (+3.83%).
- RSI at 43.5 indicates stock is not overbought, potential for rebound.
Industry
- Consumer electronics industry P/E at 24.6, far lower than PGEL’s 132, highlighting overvaluation.
- Sector outlook supported by rising consumer demand, but profitability pressures remain.
Conclusion
- PGEL shows growth in quarterly profits but suffers from weak return ratios and extreme overvaluation.
- High multiples and low efficiency make it unattractive for conservative investors.
- Accumulation near ₹460–500 may be considered for speculative exposure, with cautious long-term outlook until fundamentals improve.
I can also prepare a valuation comparison with other listed consumer electronics companies to highlight how PGEL stacks up in terms of P/E, ROE, and growth potential. Would you like me to create that?