MANYAVAR - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 3.5
| Stock Code | MANYAVAR | Market Cap | 11,713 Cr. | Current Price | 482 ₹ | High / Low | 975 ₹ |
| Stock P/E | 30.4 | Book Value | 70.8 ₹ | Dividend Yield | 1.66 % | ROCE | 25.9 % |
| ROE | 22.3 % | Face Value | 1.00 ₹ | DMA 50 | 551 ₹ | DMA 200 | 700 ₹ |
| Chg in FII Hold | -0.47 % | Chg in DII Hold | 1.05 % | PAT Qtr | 56.1 Cr. | PAT Prev Qtr | 70.3 Cr. |
| RSI | 28.5 | MACD | -24.7 | Volume | 1,47,876 | Avg Vol 1Wk | 1,88,729 |
| Low price | 466 ₹ | High price | 975 ₹ | PEG Ratio | 4.06 | Debt to equity | 0.27 |
| 52w Index | 3.28 % | Qtr Profit Var | -16.2 % | EPS | 15.9 ₹ | Industry PE | 43.7 |
📊 Analysis: Vedant Fashions (MANYAVAR) has strong fundamentals with ROE at 22.3% and ROCE at 25.9%, reflecting efficient capital use. Dividend yield of 1.66% adds income support. Debt-to-equity is moderate at 0.27, manageable for growth. However, the stock trades at a P/E of 30.4, below the industry average of 43.7, suggesting fair valuation but not cheap. EPS of ₹15.9 is decent, though quarterly PAT declined (-16.2%), raising concerns about earnings momentum. PEG ratio of 4.06 indicates stretched growth-adjusted valuation. Technicals show RSI at 28.5 (oversold) and MACD negative (-24.7), pointing to short-term weakness but potential rebound from lower levels.
💰 Entry Price Zone: Ideal accumulation zone is between ₹460 – ₹480, closer to its 52-week low and below DMA50, offering margin of safety.
⏳ Exit / Holding Strategy: If already holding, maintain with a medium to long-term horizon (3–5 years) given strong ROE/ROCE and brand leadership. Consider partial profit booking near ₹700 – ₹750 (DMA200 recovery zone) if earnings do not accelerate. Dividend yield provides minor support, but growth sustainability is key for compounding.
Positive
- 👔 Strong ROE (22.3%) and ROCE (25.9%).
- 📈 Dividend yield of 1.66% adds income support.
- 🏦 Manageable debt-to-equity (0.27).
- ✅ DII stake increased (+1.05%), showing domestic institutional confidence.
Limitation
- ⚠️ PEG ratio of 4.06 indicates stretched growth valuation.
- 📉 Quarterly PAT decline (-16.2%).
- 🔻 RSI oversold (28.5) and MACD negative (-24.7) show weak momentum.
Company Negative News
- 📉 PAT fell from ₹70.3 Cr to ₹56.1 Cr.
- 🚫 FII holding reduced (-0.47%), showing reduced foreign investor confidence.
Company Positive News
- ✅ DII stake increased (+1.05%), signaling domestic trust.
- 💡 Strong brand positioning in ethnic wear market.
Industry
- 🏭 Apparel & lifestyle industry PE ~43.7, higher than MANYAVAR’s valuation.
- 🌍 Sector growth driven by rising demand for branded ethnic wear and premiumization.
Conclusion
MANYAVAR is fundamentally strong with high ROE/ROCE and brand leadership, making it a reasonable candidate for long-term investment. However, valuations are stretched on growth metrics, and earnings momentum has weakened. Ideal entry is near ₹460–₹480 for margin of safety. Existing holders should maintain positions but consider partial exit near ₹700–₹750 unless profitability improves. The stock is best suited for disciplined investors focusing on brand-driven growth with valuation caution.
Selva, since you’re building basket overlays, would you like me to prepare a peer benchmarking comparison (MANYAVAR vs Trent, Aditya Birla Fashion, Shoppers Stop, etc.) so you can evaluate sector rotation and compounding potential more clearly?