ROUTE - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | ROUTE | Market Cap | 4,047 Cr. | Current Price | 642 ₹ | High / Low | 1,328 ₹ |
| Stock P/E | 29.1 | Book Value | 205 ₹ | Dividend Yield | 1.71 % | ROCE | 16.3 % |
| ROE | 12.4 % | Face Value | 10.0 ₹ | DMA 50 | 700 ₹ | DMA 200 | 864 ₹ |
| Chg in FII Hold | -0.62 % | Chg in DII Hold | -0.67 % | PAT Qtr | 32.9 Cr. | PAT Prev Qtr | 30.4 Cr. |
| RSI | 34.2 | MACD | -11.8 | Volume | 1,34,480 | Avg Vol 1Wk | 1,21,057 |
| Low price | 636 ₹ | High price | 1,328 ₹ | PEG Ratio | 0.42 | Debt to equity | 0.00 |
| 52w Index | 0.79 % | Qtr Profit Var | -31.4 % | EPS | 18.8 ₹ | Industry PE | 13.8 |
📊 Financials: Route Mobile shows moderate profitability with EPS at 18.8 ₹. ROE of 12.4% and ROCE of 16.3% reflect decent efficiency in capital utilization. Debt-to-equity is 0.00, highlighting a debt-free balance sheet. Quarterly PAT improved to 32.9 Cr. from 30.4 Cr., but profit variation (-31.4%) indicates earnings inconsistency. Dividend yield of 1.71% adds moderate investor appeal.
💹 Valuation: Current P/E of 29.1 is higher than the industry average of 13.8, suggesting premium valuation. Book Value of 205 ₹ gives a P/B ratio of ~3.13, which is moderately expensive. PEG ratio of 0.42 indicates earnings growth is somewhat aligned with valuation, but volatility remains a concern. Intrinsic value appears lower than current market price, making the stock slightly stretched.
🏢 Business Model & Health: Route Mobile operates in cloud communication and messaging solutions, serving enterprises with SMS, voice, and digital communication services. Competitive advantage lies in global presence, diversified client base, and technology-driven offerings. Overall health is strong with debt-free status and consistent profitability, though earnings volatility and premium valuations limit attractiveness.
🎯 Entry Zone: Current price of 642 ₹ is near its 52-week low (636 ₹), far below its high (1,328 ₹). RSI at 34.2 suggests oversold conditions, indicating potential for a rebound. A safer entry zone would be around 600–620 ₹, offering better risk-reward balance.
📈 Long-Term Holding Guidance: Route Mobile is suitable for long-term holding given its strong business model and debt-free balance sheet. Investors should accumulate on dips, with patience for earnings stability and valuation alignment.
Positive
- 📈 Debt-free balance sheet (Debt-to-equity 0.00).
- 💹 Healthy ROE (12.4%) and ROCE (16.3%).
- 🏢 Strong business model in cloud communication services.
- 💸 Dividend yield of 1.71% adds investor appeal.
Limitation
- ⚠️ High P/E ratio (29.1) vs industry average (13.8).
- 📉 Expensive P/B ratio (~3.13).
- 📊 Quarterly profit variation (-31.4%) shows inconsistency.
Company Negative News
- 📉 Decline in FII holdings (-0.62%).
- ⚠️ Reduction in DII holdings (-0.67%).
Company Positive News
- 📈 PAT growth compared to previous quarter (32.9 Cr. vs 30.4 Cr.).
- 💹 Debt-free status with consistent dividend payouts.
Industry
- 🌐 Cloud communication and messaging sector supported by enterprise digital adoption.
- 📊 Industry PE at 13.8, highlighting Route Mobile’s premium valuation multiples.
Conclusion
⚖️ Route Mobile is a fundamentally strong, debt-free company with a solid business model in cloud communications. However, current valuations are stretched, and earnings volatility persists. Entry is advisable only around 600–620 ₹. Long-term investors can hold cautiously, with confidence in its technology-driven growth but patience for improved earnings consistency.
Would you like me to also prepare a peer comparison with Tanla Platforms and other communication-tech firms to highlight Route Mobile’s relative valuation and growth prospects?