SAREGAMA - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.7
| Stock Code | SAREGAMA | Market Cap | 7,762 Cr. | Current Price | 403 ₹ | High / Low | 603 ₹ |
| Stock P/E | 35.1 | Book Value | 87.8 ₹ | Dividend Yield | 1.12 % | ROCE | 18.0 % |
| ROE | 13.6 % | Face Value | 1.00 ₹ | DMA 50 | 356 ₹ | DMA 200 | 388 ₹ |
| Chg in FII Hold | -2.00 % | Chg in DII Hold | 2.06 % | PAT Qtr | 75.4 Cr. | PAT Prev Qtr | 58.1 Cr. |
| RSI | 64.0 | MACD | 16.8 | Volume | 13,81,840 | Avg Vol 1Wk | 61,40,694 |
| Low price | 306 ₹ | High price | 603 ₹ | PEG Ratio | 3.79 | Debt to equity | 0.06 |
| 52w Index | 32.6 % | Qtr Profit Var | 35.9 % | EPS | 11.2 ₹ | Industry PE | 38.5 |
📊 Financials: SAREGAMA has a market cap of ₹7,762 Cr. Quarterly PAT rose from ₹58.1 Cr. to ₹75.4 Cr. (35.9% growth), showing strong profitability momentum. ROE at 13.6% and ROCE at 18.0% reflect healthy efficiency. Debt-to-equity ratio of 0.06 indicates very low leverage, supporting financial stability. EPS at ₹11.2 is decent relative to its scale.
💹 Valuation: Current P/E of 35.1 is slightly below the industry average of 38.5, suggesting fair valuation. P/B ratio (~4.6) is elevated compared to book value ₹87.8. PEG ratio at 3.79 indicates expensive growth relative to earnings. Intrinsic value appears close to CMP ₹403, leaving moderate upside potential.
🏦 Business Model: SAREGAMA operates in music, entertainment, and IP licensing. Its competitive advantage lies in its vast music library, strong brand recognition, and monetization through streaming platforms and physical products. Diversified revenue streams provide resilience, though competition in digital entertainment is intense.
📉 Entry Zone: RSI at 64.0 suggests mildly overbought conditions, while MACD at 16.8 indicates bullish momentum. A potential entry zone could be around ₹370–₹390 for accumulation. Long-term investors may hold, given strong fundamentals and brand advantage.
Positive
- 📈 Strong quarterly PAT growth (35.9%).
- 💰 Low debt-to-equity ratio (0.06).
- 🎵 Vast music IP library and strong brand presence.
Limitation
- ⚠️ High P/B ratio (~4.6).
- 📉 PEG ratio at 3.79, indicating expensive growth.
- 🔄 Competition in digital entertainment space.
Company Negative News
- 📉 Decline in FII holding (-2.00%).
Company Positive News
- 📊 Increase in DII holding (+2.06%).
- 📈 PAT growth from ₹58.1 Cr. to ₹75.4 Cr.
Industry
- 💹 Industry PE at 38.5, slightly higher than SAREGAMA’s 35.1.
- ⚡ Entertainment sector expanding with digital streaming adoption.
- 🏦 Strong demand for IP licensing and content monetization.
Conclusion
⚖️ SAREGAMA is a fundamentally strong entertainment company with robust profitability, low leverage, and valuable IP assets. Valuation is fair relative to industry, though growth is priced expensively. Entry may be considered around ₹370–₹390 for long-term investors, with confidence in its brand and IP-driven business model.
For a broader perspective, you could explore SAREGAMA peer comparison or a technical chart analysis to complement this fundamental view.