UBL - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.7

📊 Core Financials Breakdown

Profitability

ROCE: 13.9% and ROE: 10.8% — decent, but not exceptional for a consumer-facing business.

EPS: ₹17.1, with PAT rising from ₹97.4 Cr. to ₹184 Cr. — a 6.02% quarterly improvement, showing steady but modest growth.

Debt-to-equity: 0.14 — low leverage, indicating strong financial discipline.

Dividend Yield: 0.56% — modest, not a major draw for income investors.

Institutional Sentiment

FII holding declined (-0.19%), while DII increased (+0.20%) — mixed but slightly positive domestic outlook.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 102 Extremely high vs. industry average (33.0) — suggests significant overvaluation.

P/B Ratio ~10.9 Elevated, typical for premium consumer brands.

PEG Ratio 12.8 Very high — valuation not supported by earnings growth.

Intrinsic Value ~₹1,600–₹1,650 (est.) Current price of ₹1,799 is above fair value.

🧠 Business Model & Competitive Edge

Core Operations: United Breweries Ltd. (UBL) is India’s leading beer manufacturer, best known for Kingfisher and other premium brands.

Strengths

Dominant market share in India’s beer segment.

Strong brand equity and distribution network.

Backed by Heineken, offering global scale and operational expertise.

Challenges

High valuation multiples and low margin expansion.

RSI at 35.9 — nearing oversold territory.

MACD at -31.3 — bearish momentum.

📈 Entry Zone & Technicals

DMA 50: ₹1,888, DMA 200: ₹1,962 — price is below both, indicating short-term weakness.

RSI: 35.9 — approaching oversold.

MACD: -31.3 — bearish crossover.

📌 Entry Zone: ₹1,650–₹1,700 — ideal for accumulation on dips.

🕰️ Long-Term Holding Guidance

2025 Target: ₹2,165 (average analyst estimate)

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2026 Target: ₹2,308–₹2,796 (based on technical projections)

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2030 Target: ₹3,200+ (assuming sustained growth and margin expansion)

Holding Strategy: UBL is a premium consumer play with strong brand loyalty and long-term growth potential. Suitable for patient investors who can tolerate short-term volatility and high valuation. Accumulate during technical weakness and hold through cycles.

You can explore analyst reports on Trendlyne’s UBL dashboard

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or review long-term forecasts on Dailybulls’ projection page

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1

trendlyne.com

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dailybulls.in

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