KAJARIACER - Investment Analysis

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

📊 Investment Analysis: Kajaria Ceramics Ltd. (₹1,163)

Investment Rating: 3.6

Kajaria Ceramics presents a mixed bag — strong branding and operational stability, but a rich valuation and modest efficiency make timing and entry strategy vital for long-term success.

🧱 Fundamentals Review

ROCE: 16.8%, ROE: 12.8%

Decent capital efficiency, but not exceptional for a high-growth investment thesis.

EPS: ₹19.7, P/E: 52.8

Highly valued compared to industry P/E (41.8) — demands strong future earnings to justify.

PEG Ratio: -16.0

❌ Indicates potential EPS decline or unrealistic growth projection — valuation may be stretched.

Debt-to-Equity: 0.10

✅ Low leverage — financially safe and resilient.

PAT Growth: ₹111 Cr vs ₹72.8 Cr (▲16.9%)

Encouraging uptick, but must be sustained over multiple quarters.

📉 Technical Indicators & Sentiment

RSI: 51.9, MACD: 28.2

Momentum is neutral-to-bullish — but no decisive breakout signal yet.

DMA 50: ₹1,103, DMA 200: ₹1,074

Price above both averages — indicates short-term support and mild uptrend.

FII ▼ 3.24%, DII ▼ 0.29%

Institutional investors appear cautious — sentiment still rebuilding.

Volume: Above average

Strong trading activity — could be accumulation or repositioning underway.

🎯 Ideal Entry Price Zone

Suggested Buy Range: ₹1,025–₹1,090

Offers cushion against valuation risk and aligns with DMA levels.

Look for RSI bounce from ~45 and flattening MACD to confirm entry.

🛣️ Exit Strategy / Holding Period

If you currently hold KAJARIACER

Holding Period: 1.5–3 years, contingent on profit trajectory and valuation correction.

Exit Range: ₹1,450–₹1,575 — near prior highs, ideal for partial booking.

Watch For

ROE improving above 15%

PEG ratio normalizing to positive range

RSI nearing 70 with slowing PAT — signal to start trimming

📌 Verdict

Kajaria Ceramics is a market leader in tile manufacturing, offering brand power and low leverage. However, its rich valuation and only moderate efficiency metrics make it better suited for mid-term tactical allocation than aggressive long-term compounding — unless growth surprises upside.

Want to stack it against peers like Somany or Asian Granito for a better sector scan? I’ve got you covered with a quick comparative grid.

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