RRKABEL - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.9

📊 Core Financials Analysis

Profitability

ROE: 15.2% and ROCE: 19.7% — solid return metrics, indicating efficient capital deployment.

EPS: ₹29.6 — healthy earnings per share, though recent PAT dropped from ₹128 Cr to ₹88.8 Cr.

Quarterly Profit Variation: +38.9% YoY — strong growth, but sequential softness suggests cyclical pressure.

Balance Sheet & Cash Flow

Debt-to-equity: 0.14 — low leverage, a strong positive.

Dividend Yield: 0.48% — modest, consistent with a growth-oriented strategy.

Cash flows are stable, supported by strong operating margins and low debt.

📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 42.4 Richly valued vs industry PE of 29.1

P/B Ratio ~6.59 High, but supported by strong ROE

PEG Ratio 3.12 Overvalued relative to growth

Intrinsic Value ₹1,100–₹1,180 (est.) Current price slightly above fair value

🧠 Business Model & Competitive Edge

Company Profile: RR Kabel is a leading manufacturer of wires, cables, and fast-moving electrical goods (FMEG) in India.

Strengths

Diversified product portfolio across residential, industrial, and infrastructure segments.

Strong brand positioning and expanding distribution network.

Institutional interest rising — FII holdings up by 1.4%.

Challenges

High valuation multiples not fully backed by earnings growth.

Recent profit dip and high PEG ratio suggest near-term caution.

📈 Technical & Sentiment Overview

RSI: 52.4 — neutral zone, no strong momentum.

MACD: -6.07 — bearish crossover, short-term weakness.

DMA 50 & 200: Price hovering near both — trend indecisive.

Volume: Above weekly average — active investor interest.

FII/DII Holding: Mixed sentiment — FII increase, DII reduction.

💡 Entry Zone & Long-Term Guidance

Suggested Entry Range: ₹1,100–₹1,180 — closer to intrinsic value and technical support.

Holding Strategy

Suitable for long-term investors seeking exposure to India’s electrification and infrastructure growth.

Price targets for FY27 range from ₹1,450 to ₹1,700 based on projected earnings.

Monitor margin trends, export growth, and FMEG segment expansion.

RR Kabel is a quality mid-cap with strong fundamentals and sector tailwinds, but current valuations demand selectivity. If you're building a portfolio of durable industrial leaders, this one deserves a watchlist spot. You can explore long-term targets on Stock Price Archive

1

or review ROE insights on Simply Wall St

2

.

1

stockpricearchive.com

2

simplywall.st

Edit in a page