UPL - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.3

Here’s a clear-eyed breakdown of UPL Ltd., highlighting the key fundamentals, valuation signals, and outlook

📊 Core Financials

Return Metrics

ROE: 3.01%, ROCE: 7.66% — relatively weak; the company isn’t generating strong returns on capital or equity

EPS: ₹10.6 — moderate earnings, though not especially compelling given the share price

Profit Trends

PAT Growth Q-o-Q: ₹902 Cr → ₹1,075 Cr — impressive surge (+826%), but such explosive growth may be unsustainable or driven by one-time factors

Leverage

Debt-to-Equity: 0.86 — on the higher side, though not uncommon for a large cap industrial stock. Could pressure margins if earnings don’t hold up

📈 Valuation Overview

Metric Value Remarks

P/E Ratio 73.3 Extremely high — nearly double the industry average (36.5), signals overpriced

P/B Ratio ~2.10 Fair — might be acceptable if ROE improves

PEG Ratio -1.82 Negative PEG — usually indicates inconsistent or declining earnings growth

Dividend Yield 0.83% Modest — fine for supplemental income, but not a strong yield play

🌿 Business Model & Edge

Sector: Agrochemicals

Reach: UPL has a strong global footprint, particularly in Latin America, India, and Africa

Products: Crop protection solutions, biosolutions, seed treatments

Advantages

Extensive distribution network

Partnerships with global players

Aggressive R&D investment

Concerns

Low ROE/ROCE despite scale

Volatility in commodity and regulatory cycles

Competitive pressures and pricing dynamics in global crop protection

📉 Technical Sentiment

RSI: 69.5 — approaching overbought territory; could face resistance near 736

MACD: 19.9 — strong bullish signal, confirms current momentum

DMA Status: Trading well above 50-DMA and 200-DMA — short-term strength, but stretched

Volume Spike: Above average — active interest, possibly short-covering or momentum traders

🎯 Entry Zone & Investment Guidance

Suggested Entry: ₹665–₹690 — a more conservative level to wait for a possible pullback

Target Hold Range: ₹850–₹900 over 12–15 months if profitability strengthens

Investor Profile Fit

Suitable for high-risk, cyclical growth investors

Less attractive for conservative or dividend-focused buyers given valuation and low capital efficiency

Would you like a side-by-side with PI Industries or Sumitomo Chemicals to see how UPL stacks up against other agrochemical giants? Or should we explore earnings quality and possible margin scenarios next? Let’s keep going.

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