MARICO - Investment Analysis

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

Investment Rating: 3.5

📊 Fundamental Analysis

Marico is a well-established FMCG player with exceptional capital efficiency, but its current valuation metrics suggest limited upside for long-term investors unless earnings growth accelerates.

Metric Value Implication

Market Cap ₹90,390 Cr. Large-cap; strong brand and distribution network

Stock P/E 56.0 Highly overvalued vs. Industry PE of 30.2

PEG Ratio 5.82 Very high — price far exceeds growth expectations

ROE / ROCE 41.3% / 45.2% Outstanding — top-tier capital efficiency

Dividend Yield 1.50% Decent yield — adds income stability

Debt-to-Equity 0.14 Very low — excellent financial health

EPS ₹12.6 Solid earnings, but not enough to justify current valuation

Profit Growth (QoQ) +7.86% Mild growth — not aggressive

📉 Technical & Trend Analysis

Current Price: ₹698

DMA 50 / DMA 200: ₹710 / ₹675 — trading below 50 DMA, slightly above 200 DMA

RSI: 39.3 — nearing oversold zone

MACD: -2.77 — bearish momentum

Volume: Above average — active trading, but likely distribution

⚖️ Is It a Good Long-Term Investment?

Moderately attractive, but expensive. Marico’s fundamentals are stellar — especially ROE and ROCE — but the P/E of 56 and PEG of 5.82 suggest the stock is priced for perfection. Long-term returns may be muted unless earnings growth picks up meaningfully.

🎯 Ideal Entry Price Zone

Buy Zone: ₹660–₹680

Near 200 DMA and RSI oversold territory

Offers better margin of safety

Wait for PEG to drop below 3.5 or P/E to normalize

🧭 Exit Strategy / Holding Period (If Already Holding)

If you're already invested

Holding Period: 2–3 years, with semi-annual review of earnings growth

Exit Strategy

Partial Exit near ₹740–₹750 if valuation remains stretched

Full Exit if PEG stays above 5.5 and ROE drops below 35%

Reassess if FMCG sector multiples compress or volume growth stagnates

Would you like a comparison with peers like Dabur, HUL, or Emami to evaluate relative valuation and growth potential?

Edit in a page