BRIGADE - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.9
| Stock Code | BRIGADE | Market Cap | 19,378 Cr. | Current Price | 791 ₹ | High / Low | 1,332 ₹ |
| Stock P/E | 47.6 | Book Value | 252 ₹ | Dividend Yield | 0.31 % | ROCE | 9.09 % |
| ROE | 8.80 % | Face Value | 10.0 ₹ | DMA 50 | 841 ₹ | DMA 200 | 949 ₹ |
| Chg in FII Hold | -0.53 % | Chg in DII Hold | 0.27 % | PAT Qtr | 93.9 Cr. | PAT Prev Qtr | 50.2 Cr. |
| RSI | 47.0 | MACD | -30.1 | Volume | 2,10,322 | Avg Vol 1Wk | 4,23,724 |
| Low price | 711 ₹ | High price | 1,332 ₹ | PEG Ratio | 3.24 | Debt to equity | 0.32 |
| 52w Index | 12.8 % | Qtr Profit Var | 3.11 % | EPS | 16.2 ₹ | Industry PE | 31.6 |
🔍 Analysis: Brigade Enterprises shows moderate fundamentals with ROE at 8.8% and ROCE at 9.09%, which are relatively weak compared to industry standards. The stock trades at a high P/E of 47.6 versus the industry average of 31.6, indicating stretched valuations. Dividend yield is low at 0.31%, offering minimal income support. PEG ratio of 3.24 suggests overvaluation relative to growth. Quarterly PAT improved (93.9 Cr vs 50.2 Cr), but overall profit variation is modest (3.11%). Current price (791 ₹) is below DMA supports (50 DMA at 841 ₹, 200 DMA at 949 ₹), reflecting bearish momentum and limited upside compared to its 52-week high (1,332 ₹).
💡 Entry Zone: Ideal entry would be in the 720–760 ₹ range, closer to the 52-week low (711 ₹), offering margin of safety. Accumulation should be cautious given weak efficiency metrics.
📈 Exit / Holding Strategy: If already holding, consider tactical holding for 12–24 months, but exit near 1,250–1,300 ₹ resistance if valuations stretch without significant improvement in ROE/ROCE. Long-term holding is not advisable unless profitability strengthens and valuations normalize.
🌟 Positive
- Quarterly PAT improved (93.9 Cr vs 50.2 Cr)
- DII holdings increased (+0.27%)
- Debt-to-equity at 0.32, manageable leverage
- EPS at 16.2 ₹ supports valuation comfort
⚠️ Limitation
- High P/E (47.6 vs industry 31.6)
- Weak ROE (8.8%) and ROCE (9.09%)
- PEG ratio (3.24) signals overvaluation
- Dividend yield modest (0.31%)
- Stock trading below DMA supports, showing weak momentum
📉 Company Negative News
- FII holdings reduced (-0.53%)
- Profit growth variation remains modest despite PAT improvement
📈 Company Positive News
- Quarterly PAT growth shows operational improvement
- DII stake increased, reflecting domestic confidence
- Debt levels remain manageable
🏭 Industry
- Industry PE at 31.6, lower than Brigade’s valuation
- Real estate sector benefits from urban demand but faces cyclical risks
✅ Conclusion
Brigade Enterprises is a weak-to-moderate candidate for long-term investment. High P/E, weak ROE/ROCE, and modest dividend yield limit attractiveness. Ideal entry is near 720–760 ₹ for margin of safety. Existing holders should consider tactical holding for 12–24 months, with partial exit near 1,250–1,300 ₹ resistance unless fundamentals improve significantly.