RENUKA - Fundamental Analysis

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

Fundamental Rating: 2.4

📊 Core Financial Analysis

Profitability & Returns

EPS: -₹1.41 — negative earnings per share indicates losses, despite a profitable quarter.

ROCE: 10.5% — decent return on capital employed, suggesting operational efficiency.

ROE: Not available — likely negative due to negative book value, which is a red flag.

PAT Qtr: ₹91.6 Cr vs -₹204 Cr — strong turnaround, but sustainability is uncertain.

Debt & Leverage

Book Value: -₹7.87 — indicates accumulated losses or high debt burden.

Debt-to-Equity: Not disclosed — but negative book value implies high leverage or equity erosion.

Dividend Yield: 0.00% — no payouts, typical for turnaround or distressed companies.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio Not meaningful Negative EPS makes P/E unusable

P/B Ratio Not applicable Negative book value distorts valuation

PEG Ratio Not available No meaningful growth data

Intrinsic Value Difficult to estimate Requires normalized earnings and debt clarity

🏢 Business Model & Competitive Edge

Shree Renuka Sugars is a leading sugar and ethanol producer with global linkages.

Business model includes

Integrated sugar production

Ethanol blending for fuel

Renewable energy from bagasse

Competitive advantage lies in scale, ethanol potential, and global sourcing.

However, commodity price volatility, government policy dependence, and high debt weaken its resilience.

📉 Technical & Sentiment Indicators

RSI: 37.3 — approaching oversold territory.

MACD: -0.48 — bearish momentum.

Volume above average — suggests speculative interest or panic selling.

DMA 50 & 200 above current price — bearish trend.

FII/DII holding changes are negligible — low institutional conviction.

🧠 Investment Guidance

🔍 Entry Zone (If Undervalued)

Speculative Buy Range: ₹25–₹28

Only for high-risk investors betting on turnaround.

Wait for confirmation of sustained profitability and debt reduction.

📈 Long-Term Holding View

Avoid for conservative investors

Financial instability and negative equity.

Volatile earnings and unclear valuation.

Monitor ethanol policy tailwinds and debt restructuring.

Would you like a deep dive into how ethanol blending mandates could impact Renuka’s future cash flows and valuation? Or a comparison with peers like Balrampur Chini or Dwarikesh Sugar?

Edit in a page