⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
UPL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.9
| Stock Code | UPL | Market Cap | 56,114 Cr. | Current Price | 665 ₹ | High / Low | 812 ₹ |
| Stock P/E | 51.9 | Book Value | 162 ₹ | Dividend Yield | 0.90 % | ROCE | 1.26 % |
| ROE | 8.20 % | Face Value | 2.00 ₹ | DMA 50 | 744 ₹ | DMA 200 | 700 ₹ |
| Chg in FII Hold | 1.83 % | Chg in DII Hold | -0.46 % | PAT Qtr | 416 Cr. | PAT Prev Qtr | 122 Cr. |
| RSI | 26.5 | MACD | -20.7 | Volume | 14,68,380 | Avg Vol 1Wk | 28,02,218 |
| Low price | 580 ₹ | High price | 812 ₹ | PEG Ratio | -4.30 | Debt to equity | 0.07 |
| 52w Index | 36.6 % | Qtr Profit Var | 823 % | EPS | 37.0 ₹ | Industry PE | 27.7 |
📊 Core Financials
- Revenue Growth: Quarterly PAT surged from 122 Cr. to 416 Cr., showing sharp improvement, though sustainability is uncertain.
- Profit Margins: EPS at 37.0 ₹ reflects profitability, but margins remain inconsistent.
- Debt Ratios: Debt-to-equity at 0.07, very low leverage, ensuring financial stability.
- Cash Flows: Likely positive given profit rebound and low debt burden.
- Return Metrics: ROCE at 1.26% and ROE at 8.20% are weak, highlighting poor capital efficiency.
💹 Valuation Indicators
- P/E Ratio: 51.9, significantly higher than industry average (27.7), suggesting overvaluation.
- P/B Ratio: ~4.1 (Current Price / Book Value), moderately expensive.
- PEG Ratio: -4.30, negative, reflecting poor growth-adjusted valuation.
- Intrinsic Value: Current price (665 ₹) trades below DMA 50 (744 ₹) and DMA 200 (700 ₹), signaling bearish sentiment.
🏢 Business Model & Competitive Advantage
- UPL operates in agrochemicals and crop protection, with global presence across multiple geographies.
- Competitive advantage lies in scale, diversified product portfolio, and global distribution network.
- Weak return ratios and stretched valuation undermine long-term attractiveness despite strong market position.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive only near 600–630 ₹, closer to support levels, given current overvaluation and weak fundamentals.
- Long-Term Holding: Risky unless ROCE improves significantly. Suitable for investors with high risk tolerance seeking agrochemical exposure.
Positive
- Quarterly PAT jumped sharply (+823%), showing strong short-term performance.
- Low debt-to-equity ratio (0.07) ensures financial stability.
- FII holdings increased (+1.83%), reflecting foreign investor confidence.
Limitation
- ROCE (1.26%) and ROE (8.20%) remain weak.
- P/E ratio much higher than industry average, suggesting overvaluation.
- PEG ratio negative, highlighting poor growth-adjusted valuation.
Company Negative News
- DII holdings decreased (-0.46%), showing reduced domestic institutional support.
- Stock trading below DMA 50 and DMA 200, reflecting bearish sentiment.
Company Positive News
- Quarterly PAT improved significantly from 122 Cr. to 416 Cr.
- FII holdings increased, showing foreign investor confidence.
Industry
- Agrochemical industry trades at P/E of 27.7, much lower than UPL’s valuation.
- Sector benefits from rising global food demand and crop protection needs, but faces regulatory and commodity risks.
Conclusion
- UPL shows strong short-term profit growth but weak efficiency metrics and stretched valuation.
- Low debt provides stability, but poor ROCE limits attractiveness.
- Entry near 600–630 ₹ offers better risk-reward; long-term holding is risky unless operational efficiency improves.
I can also prepare a peer comparison HTML table (UPL vs Bayer CropScience, PI Industries, Rallis India) to highlight relative valuation and efficiency metrics if you’d like.