VGUARD - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.8

📊 Core Financials Overview

Profitability

ROCE: 17.2% and ROE: 13.6% — solid, indicating efficient capital deployment.

EPS: ₹5.37, though PAT declined from ₹78.1 Cr. to ₹55.7 Cr. — a 32% drop, reflecting margin pressure or seasonal weakness.

Debt-to-equity: 0.04 — extremely low, showcasing strong financial discipline.

Dividend Yield: 0.41% — modest, typical for growth-oriented consumer electronics firms.

Institutional Sentiment

FII holdings declined (-0.88%), while DII holdings increased (+0.98%) — domestic investors show confidence despite foreign caution.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 69.0 High vs. industry average (56.8) — priced for growth.

P/B Ratio ~8.06 Elevated, but common for consumer brands with strong brand equity.

PEG Ratio 17.2 Very high — valuation not supported by earnings growth.

Intrinsic Value ~₹340–₹360 (est.) Current price of ₹370 is slightly above fair value.

🧠 Business Model & Competitive Edge

Core Operations: V-Guard Industries manufactures electrical appliances including stabilizers, inverters, water heaters, fans, and kitchen products.

Strengths

Strong brand recall in South India and expanding pan-India presence.

Diversified product portfolio with seasonal and non-seasonal categories.

Low debt and consistent cash flows.

Challenges

Recent earnings contraction and high valuation multiples.

RSI at 50.4 — neutral, MACD at -0.18 — bearish crossover.

📈 Entry Zone & Technicals

DMA 50: ₹372, DMA 200: ₹379 — price is hovering near both, indicating consolidation.

RSI: 50.4 — neutral zone.

MACD: -0.18 — bearish momentum.

📌 Entry Zone: ₹340–₹360 — ideal for accumulation on dips.

🕰️ Long-Term Holding Guidance

2025 PE Ratio: ~56.8 with TTM EPS of ₹6.56

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2026–2028 Target: ₹450–₹520

2030 Target: ₹600+

Holding Strategy: V-Guard is a stable consumer play with strong fundamentals, low debt, and brand-driven growth. Suitable for long-term investors seeking exposure to India’s rising middle-class consumption. Accumulate during technical weakness and hold through cycles.

You can explore historical valuation trends on GuruFocus’s PE Ratio dashboard

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