WESTLIFE - Fundamental Analysis: Financial Health & Valuation

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

Fundamental Rating: 3.4

📊 Core Financials Breakdown

Profitability

ROE: 0.18% and ROCE: -0.08% — extremely weak, indicating poor capital efficiency and operational returns.

EPS: ₹0.99, though PAT surged from ₹1.31 Cr. to ₹14.5 Cr. — a massive 20,843% quarterly jump, but from a very low base.

Debt-to-equity: 0.00 — debt-free, which is a major strength in terms of financial resilience.

Dividend Yield: 0.47% — modest, but consistent.

Institutional Sentiment

FII holding declined (-1.62%), while DII increased (+1.70%) — domestic investors show confidence despite foreign caution.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 746 Extremely high vs. industry average (157) — signals severe overvaluation.

P/B Ratio ~22.9 Very elevated — reflects premium pricing despite weak book value.

PEG Ratio 12.4 High — valuation not supported by earnings growth.

Intrinsic Value ~₹680–₹700 (est.) Current price of ₹741 is slightly above fair value.

🧠 Business Model & Competitive Edge

Core Operations: Westlife Foodworld Ltd. operates McDonald’s restaurants in West and South India through its subsidiary Hardcastle Restaurants.

Strengths

Strong brand equity via McDonald’s franchise.

Scalable QSR model with digital and delivery integration.

Debt-free structure and improving profitability.

Challenges

Extremely high valuation multiples and weak return metrics.

RSI at 53.4 — neutral, MACD at 7.42 — bullish momentum but low volume.

EPS and ROE remain low despite recent profit spike.

📈 Entry Zone & Technicals

DMA 50: ₹730, DMA 200: ₹741 — price is hovering near both, indicating consolidation.

RSI: 53.4 — neutral zone.

MACD: 7.42 — bullish crossover.

📌 Entry Zone: ₹680–₹710 — ideal for accumulation if valuation cools.

🕰️ Long-Term Holding Guidance

2025 Target: ₹671.7–₹847.7

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2026 Target: ₹847.7–₹881.6

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2027 Target: ₹881.6–₹925.7

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2030 Target: ₹1,100+ (based on DCF projections)

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Holding Strategy: Westlife is a premium QSR play with strong brand backing and long-term growth potential. However, current valuation is stretched. Suitable for patient investors with high risk tolerance. Accumulate cautiously during dips and monitor earnings consistency.

You can explore analyst forecasts on Trendlyne’s research dashboard

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and review long-term projections on Stocks-Buy’s valuation page

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stocks-buy.com

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trendlyne.com

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