UBL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | UBL | Market Cap | 38,566 Cr. | Current Price | 1,459 ₹ | High / Low | 2,245 ₹ |
| Stock P/E | 91.8 | Book Value | 164 ₹ | Dividend Yield | 0.69 % | ROCE | 13.9 % |
| ROE | 10.8 % | Face Value | 1.00 ₹ | DMA 50 | 1,535 ₹ | DMA 200 | 1,678 ₹ |
| Chg in FII Hold | -0.56 % | Chg in DII Hold | 0.63 % | PAT Qtr | 92.0 Cr. | PAT Prev Qtr | 47.0 Cr. |
| RSI | 38.8 | MACD | -24.4 | Volume | 2,14,677 | Avg Vol 1Wk | 1,98,342 |
| Low price | 1,401 ₹ | High price | 2,245 ₹ | PEG Ratio | 11.5 | Debt to equity | 0.18 |
| 52w Index | 6.81 % | Qtr Profit Var | 76.8 % | EPS | 15.5 ₹ | Industry PE | 40.4 |
📊 UBL shows weak fundamentals with ROE at 10.8% and ROCE at 13.9%, reflecting modest efficiency. EPS of 15.5 ₹ supports profitability, and quarterly PAT improved (92 Cr. vs 47 Cr.), showing strong sequential growth. Debt-to-equity ratio of 0.18 indicates manageable leverage, and dividend yield of 0.69% adds investor appeal. However, valuation is extremely stretched with P/E at 91.8 compared to industry average of 40.4, while PEG ratio of 11.5 highlights expensive growth expectations. Technical indicators (RSI 38.8, MACD -24.4) show oversold conditions and weak momentum, with price trading below both 50 DMA (1,535 ₹) and 200 DMA (1,678 ₹).
💡 Entry Price Zone: Attractive accumulation between 1,400 ₹ – 1,450 ₹ near support levels. Buying above 1,500 ₹ carries valuation risk.
📈 Long-Term Holding Guidance: UBL is moderately attractive for long-term investors (3–5 years) only if earnings growth sustains. Conservative investors should wait for improved efficiency and valuation correction before committing heavily.
Positive
- EPS of 15.5 ₹ supports profitability.
- Quarterly PAT improved significantly (92 Cr. vs 47 Cr.).
- Debt-to-equity ratio of 0.18 ensures financial stability.
- DII holdings increased (+0.63%), showing domestic confidence.
Limitation
- High P/E (91.8) compared to industry average (40.4).
- Weak ROE (10.8%) and ROCE (13.9%).
- PEG ratio of 11.5 indicates expensive valuation relative to growth.
- RSI (38.8) shows oversold conditions, reflecting weak momentum.
- Price trading below both 50 DMA and 200 DMA.
Company Negative News
- Foreign institutional investors reduced holdings (-0.56%).
- Valuation premium may limit upside potential.
Company Positive News
- Quarterly profit variation (+76.8%) highlights strong earnings momentum.
- Domestic institutional investors increased holdings.
Industry
- Industry PE at 40.4, while UBL trades at 91.8, showing extreme premium valuation.
- Beverage sector remains resilient but cyclical, dependent on consumption trends and regulatory environment.
Conclusion
⚠️ UBL is a moderately attractive candidate with strong sequential profit growth but weak efficiency and severe overvaluation. Best suited for speculative investors who accumulate near 1,400–1,450 ₹. Exit opportunities may arise near 1,600–1,650 ₹ if momentum recovers. Long-term investors should wait for valuation correction and improved ROE/ROCE before committing heavily.
Would you like me to extend this into a beverage sector peer overlay HTML (e.g., UBL vs Radico Khaitan, Globus Spirits, and VBL) to highlight relative valuation and efficiency positioning?