CHAMBLFERT - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 4.2
| Stock Code | CHAMBLFERT | Market Cap | 17,563 Cr. | Current Price | 438 ₹ | High / Low | 742 ₹ |
| Stock P/E | 9.52 | Book Value | 241 ₹ | Dividend Yield | 2.28 % | ROCE | 27.6 % |
| ROE | 20.3 % | Face Value | 10.0 ₹ | DMA 50 | 451 ₹ | DMA 200 | 495 ₹ |
| Chg in FII Hold | -2.68 % | Chg in DII Hold | 0.65 % | PAT Qtr | 602 Cr. | PAT Prev Qtr | 638 Cr. |
| RSI | 46.6 | MACD | -5.78 | Volume | 7,89,178 | Avg Vol 1Wk | 11,06,200 |
| Low price | 410 ₹ | High price | 742 ₹ | PEG Ratio | 1.26 | Debt to equity | 0.00 |
| 52w Index | 8.38 % | Qtr Profit Var | 20.2 % | EPS | 46.0 ₹ | Industry PE | 18.6 |
📊 Analysis: CHAMBLFERT trades at a low P/E of 9.52 compared to industry average of 18.6, indicating undervaluation. Strong ROE (20.3%) and ROCE (27.6%) highlight efficient capital use. EPS of 46 ₹ supports profitability, while PEG ratio of 1.26 suggests fair valuation relative to growth. Dividend yield of 2.28% adds income stability. Debt-to-equity is 0.00, reflecting a debt-free balance sheet. Technicals show price below DMA 50 (451 ₹) and DMA 200 (495 ₹), with RSI at 46.6 and MACD (-5.78) signaling weak momentum. Quarterly PAT declined slightly (602 Cr. vs 638 Cr.), but YoY profit variation (+20.2%) remains strong. Institutional activity is mixed, with FII holdings reduced (-2.68%) and DII holdings increased (+0.65%).
💰 Ideal Entry Zone: Between 420 ₹ – 435 ₹ (near support levels and valuation comfort). Current price (438 ₹) is slightly above ideal entry, so staggered accumulation is recommended.
📈 Exit / Holding Strategy: For long-term investors already holding, maintain positions given strong ROE, ROCE, and debt-free status. Exit only if price sustains below 410 ₹ (recent low) or if earnings growth weakens significantly. Holding period: 3–5 years, with periodic review of profitability and sector demand cycles.
Positive
- Low P/E (9.52) compared to industry average (18.6)
- Strong ROE (20.3%) and ROCE (27.6%) indicate efficient capital use
- EPS of 46 ₹ supports profitability
- Dividend yield of 2.28% provides steady income
- Debt-free balance sheet (Debt-to-equity 0.00)
Limitation
- Price below DMA 50 and DMA 200 reflects weak technical trend
- MACD (-5.78) signals bearish momentum
- Quarterly PAT declined slightly (602 Cr. vs 638 Cr.)
- FII holdings reduced (-2.68%), showing foreign caution
Company Negative News
- Sequential PAT decline raises short-term concerns
- Weak technical indicators with bearish momentum
Company Positive News
- YoY profit variation (+20.2%) shows strong growth
- DII holdings increased (+0.65%), reflecting domestic support
Industry
- Industry P/E at 18.6 shows CHAMBLFERT trades at a discount
- Fertilizer sector supported by government subsidies and agricultural demand
Conclusion
✅ CHAMBLFERT is a fundamentally strong, undervalued company with efficient capital use and a debt-free balance sheet. Ideal entry is near 420–435 ₹. Long-term holders should maintain positions for 3–5 years, monitoring profitability and sector demand cycles. Caution is advised due to weak technical momentum and reduced FII participation.