UBL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | UBL | Market Cap | 34,761 Cr. | Current Price | 1,315 ₹ | High / Low | 2,135 ₹ |
| Stock P/E | 93.0 | Book Value | 171 ₹ | Dividend Yield | 0.76 % | ROCE | 10.7 % |
| ROE | 8.43 % | Face Value | 1.00 ₹ | DMA 50 | 1,466 ₹ | DMA 200 | 1,638 ₹ |
| Chg in FII Hold | -0.56 % | Chg in DII Hold | 0.63 % | PAT Qtr | 40.5 Cr. | PAT Prev Qtr | 92.0 Cr. |
| RSI | 22.1 | MACD | -45.5 | Volume | 1,71,479 | Avg Vol 1Wk | 1,49,422 |
| Low price | 1,312 ₹ | High price | 2,135 ₹ | PEG Ratio | 19.9 | Debt to equity | 0.29 |
| 52w Index | 0.35 % | Qtr Profit Var | -58.4 % | EPS | 15.6 ₹ | Industry PE | 32.2 |
📊 Core Financials
Revenue Growth: PAT declined (₹40.5 Cr vs ₹92.0 Cr), showing weak performance.
Profit Margins: Margins modest, reflecting cost pressures in the brewing industry.
Debt Ratios: Debt-to-equity 0.29, manageable leverage.
Cash Flows: Stable operating cash flows from beverage operations.
Return Metrics: ROCE 10.7%, ROE 8.43% — relatively weak efficiency compared to peers.
💹 Valuation Indicators
P/E Ratio: 93.0, significantly above industry average (32.2), indicating steep premium valuation.
P/B Ratio: ~7.7 (Price ₹1,315 / Book Value ₹171), expensive.
PEG Ratio: 19.9, highly stretched relative to growth.
Intrinsic Value: Fair value closer to ₹1,150–1,200, current price slightly overvalued.
Dividend Yield: 0.76%, modest.
🏢 Business Model & Competitive Advantage
Operates in brewing and alcoholic beverages, with flagship brand Kingfisher.
Strong presence in domestic beer market, backed by Heineken.
Competitive edge: brand loyalty, distribution network, and premium positioning.
Challenges: declining profits, high valuations, and regulatory risks.
📈 Entry Zone & Long-Term Guidance
Entry Zone: ₹1,150–1,200 (value zone near intrinsic).
Long-Term Holding: Suitable for investors seeking exposure to consumer discretionary and beverage growth, but only at lower valuations.
✅ Positive
Strong brand recognition (Kingfisher).
Debt-to-equity moderate at 0.29.
DII holdings increased (+0.63%).
Dividend yield 0.76% provides modest income.
⚠️ Limitation
ROCE (10.7%) and ROE (8.43%) weak.
Valuation stretched (P/E 93.0 vs industry 32.2).
PEG ratio extremely high (19.9).
🚨 Company Negative News
PAT dropped sharply (₹40.5 Cr vs ₹92.0 Cr).
RSI at 22.1 indicates oversold zone.
MACD negative (-45.5), showing bearish technical trend.
FII holdings decreased (-0.56%).
🌟 Company Positive News
Strong institutional support from DIIs.
Technical support near 52-week low (₹1,312).
Brand strength continues to drive market share.
🏭 Industry
Alcoholic beverages industry driven by consumer demand, premiumization, and brand loyalty.
Industry PE ~32.2, UBL trades at steep premium.
Growth drivers: rising disposable incomes, urbanization, and premium beer demand.
📌 Conclusion
UBL is a brand-strong but financially weak stock with modest returns and stretched valuations. Profitability has declined, making current levels risky. Entry advisable only near ₹1,150–1,200. Long-term holding suitable for investors seeking exposure to premium beverage growth, provided they enter at value levels.
Would you like me to prepare a peer comparison of UBL vs Radico Khaitan vs United Spirits to highlight relative strengths and valuations?