WELSPUNLIV - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | WELSPUNLIV | Market Cap | 13,356 Cr. | Current Price | 139 ₹ | High / Low | 154 ₹ |
| Stock P/E | 53.0 | Book Value | 42.5 ₹ | Dividend Yield | 1.22 % | ROCE | 6.63 % |
| ROE | 6.31 % | Face Value | 1.00 ₹ | DMA 50 | 130 ₹ | DMA 200 | 130 ₹ |
| Chg in FII Hold | -0.04 % | Chg in DII Hold | 0.75 % | PAT Qtr | 27.3 Cr. | PAT Prev Qtr | -5.33 Cr. |
| RSI | 58.9 | MACD | 4.20 | Volume | 24,66,775 | Avg Vol 1Wk | 26,00,395 |
| Low price | 107 ₹ | High price | 154 ₹ | PEG Ratio | 1.81 | Debt to equity | 0.29 |
| 52w Index | 68.7 % | Qtr Profit Var | -72.2 % | EPS | 2.51 ₹ | Industry PE | 19.7 |
📊 Core Financials:
WELSPUNLIV has shown mixed financial performance with quarterly PAT at 27.3 Cr., recovering from a loss of -5.33 Cr. in the previous quarter. ROCE at 6.63% and ROE at 6.31% are weak, reflecting limited efficiency. Debt-to-equity is moderate at 0.29, indicating manageable leverage. EPS stands at 2.51 ₹, which is modest relative to market capitalization.
💹 Valuation Indicators:
The stock trades at a P/E of 53.0, significantly above the industry average of 19.7, suggesting overvaluation. P/B ratio is ~3.27 (Price 139 ₹ / Book Value 42.5 ₹), which is moderate. PEG ratio of 1.81 indicates growth is priced at a premium. Intrinsic value appears lower than current levels, limiting margin of safety.
🏢 Business Model & Competitive Advantage:
WELSPUNLIV operates in home textiles and lifestyle products, with strong brand presence and distribution. Its competitive advantage lies in scale and brand recognition. However, profitability metrics remain weak compared to peers, limiting its edge in efficiency and growth.
🎯 Entry Zone & Long-Term Guidance:
Current price (139 ₹) is aligned with both 50 DMA (130 ₹) and 200 DMA (130 ₹), showing neutral momentum. RSI at 58.9 indicates moderate strength, while MACD (4.20) shows mild positive momentum. A good entry zone would be 125–135 ₹ if undervaluation emerges. Long-term holding is possible due to brand strength, but stretched valuations and weak profitability warrant caution.
Positive
- 📈 PAT recovery from losses (-5.33 Cr. to 27.3 Cr.).
- 💰 Moderate debt-to-equity (0.29).
- 🌍 DII holdings increased (+0.75%).
- 📊 Strong brand presence in home textiles.
Limitation
- ⚠️ Very high P/E (53.0) vs industry average (19.7).
- 📉 Weak ROCE (6.63%) and ROE (6.31%).
- 📉 EPS modest at 2.51 ₹.
- 📉 Dividend yield modest at 1.22%.
Company Negative News
📰 No major negative news reported recently, but profitability metrics remain weak and valuations are stretched.
Company Positive News
📰 PAT recovery in the latest quarter highlights operational improvement. DII holdings increased, reflecting domestic investor confidence.
Industry
🏭 Industry P/E stands at 19.7, much lower than WELSPUNLIV’s valuation. The textile and lifestyle sector remains competitive, driven by consumer demand, but margins are under pressure.
Conclusion
✅ WELSPUNLIV is financially stable with brand strength and moderate debt levels. However, valuations are stretched, and profitability metrics are weak compared to peers. Best suited for cautious long-term investors who can accumulate near 125–135 ₹. Short-term traders should remain cautious due to limited earnings visibility despite recent PAT recovery.
Would you like me to extend this into a peer comparison to evaluate how WELSPUNLIV stacks up against competitors in terms of profitability and valuation?