3MINDIA - Investment Analysis

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

Investment Rating: 4.4

📊 Fundamental & Valuation Analysis

3M India is a high-quality industrial conglomerate with strong financial metrics and global brand backing. Here's how it fares

🔍 Key Metrics

Metric Value Interpretation

ROE 30.5% Exceptional profitability

ROCE 40.5% Outstanding capital efficiency

PEG Ratio 1.07 Fairly valued for growth

Dividend Yield 0.52% Low but consistent

Debt-to-Equity 0.01 Virtually debt-free

P/E Ratio 57.2 Expensive vs industry PE of 24.9

Price-to-Book ~16.2 Highly overvalued on book basis

📈 Growth & Profitability

EPS: ₹543 — strong earnings base

PAT Growth: ₹157 Cr vs ₹173 Cr — slight dip, but YoY growth is solid

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Revenue: ₹4,445 Cr — consistent growth trajectory

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Cash Flow: ₹3,000 Cr FCF — healthy operational efficiency

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📉 Technical & Trend Analysis

Current Price: ₹30,915

RSI: 63.9 — nearing overbought zone

MACD: +551 — bullish momentum

DMA 50/200: ₹29,724 / ₹30,181 — trading above both

Volume: Below average — low conviction buying

📌 Ideal Entry Price Zone

Support Levels: ₹28,500 and ₹26,000

Fair Entry Range: ₹27,000–₹29,000

Below ₹29,000 offers better margin of safety

Avoid entry above ₹32,000 unless breakout confirmed

🧭 Exit Strategy & Holding Period

If you already hold the stock

✅ Long-Term Holding Justified If

You seek 30%+ ROE and zero debt exposure

You believe in India’s industrial and healthcare infrastructure growth

You’re comfortable with premium valuation for quality

🚪 Exit Strategy

Short-Term Exit: If price rallies near ₹40,000 (52W high) without earnings support

Hold Period: 5+ years to benefit from compounding and sectoral tailwinds

Re-evaluate: If ROE drops below 20% or valuation exceeds 80x P/E

🧠 Final Verdict

3M India is a classic long-term compounder with elite capital efficiency, global brand strength, and minimal debt. While valuations are rich, the quality justifies a premium. Ideal for patient investors who prioritize safety, consistency, and long-term wealth creation.

Would you like a peer comparison with Honeywell Automation or ABB India to see how 3M stacks up in the industrial space?

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Moneycontrol

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stockanalysis.com

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