PIDILITIND - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 4.4

📊 Core Financials Analysis

Profitability

ROE: 23.2% and ROCE: 30.5% — excellent capital efficiency, well above industry norms.

EPS: ₹42.7 — strong earnings per share, reflecting consistent bottom-line strength.

PAT Qtr: ₹650 Cr vs ₹461 Cr — a solid 17.8% growth, indicating healthy operational momentum.

Balance Sheet & Cash Flow

Debt-to-equity: 0.03 — virtually debt-free, a major strength.

Dividend Yield: 0.65% — modest, but consistent with a growth-oriented consumer business.

Strong operating cash flows and reinvestment capacity support long-term expansion.

📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 71.1 Richly valued vs industry PE of 33.9

P/B Ratio ~16.1 High, but justified by premium ROE

PEG Ratio 3.48 Overvalued relative to growth

Intrinsic Value ₹2,750–₹2,900 (est.) Current price ~5–10% above fair value

🧠 Business Model & Competitive Edge

Company Profile: Pidilite Industries is India’s leading manufacturer of adhesives, sealants, and construction chemicals, with flagship brands like Fevicol, Dr. Fixit, and M-Seal.

Strengths

Dominant market share in adhesives and waterproofing.

Deep distribution network across urban and rural India.

Strong brand equity and customer loyalty.

Growth Drivers

Expansion into waterproofing and industrial adhesives.

Rising demand from infrastructure and home improvement sectors.

Consistent innovation and product diversification.

📈 Technical & Sentiment Overview

RSI: 46.0 — neutral zone, potential for rebound.

MACD: 6.34 — mildly bullish momentum.

DMA 50 & 200: Price hovering near both — consolidation phase.

Volume: Above average — strong investor interest.

FII/DII Holding: FII increase, DII slight dip — mixed institutional sentiment.

💡 Entry Zone & Long-Term Guidance

Suggested Entry Range: ₹2,850–₹2,950 — closer to intrinsic value and technical support.

Holding Strategy

Ideal for long-term investors seeking exposure to consumer durables and construction chemicals.

Price targets for FY27 range from ₹3,600 to ₹4,200 based on projected earnings.

Monitor margin trends and rural demand growth.

Pidilite Industries is a textbook example of a high-quality compounder — strong brand, low debt, and consistent profitability. If you're building a portfolio of durable consumer businesses, this one deserves a prime spot. Want to compare it with Asian Paints or Supreme Industries next?

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