MAZDOCK - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 4.0
| Stock Code | MAZDOCK | Market Cap | 98,810 Cr. | Current Price | 2,450 ₹ | High / Low | 3,778 ₹ |
| Stock P/E | 44.3 | Book Value | 200 ₹ | Dividend Yield | 0.71 % | ROCE | 48.8 % |
| ROE | 36.5 % | Face Value | 5.00 ₹ | DMA 50 | 2,512 ₹ | DMA 200 | 2,639 ₹ |
| Chg in FII Hold | -0.17 % | Chg in DII Hold | -0.28 % | PAT Qtr | 715 Cr. | PAT Prev Qtr | 419 Cr. |
| RSI | 49.2 | MACD | -16.9 | Volume | 10,92,200 | Avg Vol 1Wk | 23,36,754 |
| Low price | 1,918 ₹ | High price | 3,778 ₹ | PEG Ratio | 0.77 | Debt to equity | 0.00 |
| 52w Index | 28.6 % | Qtr Profit Var | 26.9 % | EPS | 55.3 ₹ | Industry PE | 42.3 |
📊 Analysis: Mazagon Dock trades at ₹2,450 with a P/E of 44.3, slightly above the industry average of 42.3, suggesting fair-to-premium valuation. ROE (36.5%) and ROCE (48.8%) are excellent, reflecting strong efficiency in generating returns. Dividend yield at 0.71% provides modest income support. The PEG ratio (0.77) indicates attractive growth potential relative to valuation. Technical indicators (RSI 49.2, MACD -16.9) show neutral-to-bearish momentum, suggesting near-term consolidation. PAT has improved sequentially (419 Cr. → 715 Cr.), highlighting strong earnings growth. Debt-to-equity at 0.00 indicates a debt-free balance sheet, strengthening financial stability.
💡 Entry Price Zone: Ideal entry would be between ₹2,300–₹2,400, closer to the DMA 200 (₹2,639) and support levels, offering better valuation comfort.
📈 Exit / Holding Strategy: If already holding, Mazagon Dock is a strong candidate for long-term investment (5+ years) given robust ROE, ROCE, and earnings growth. Exit strategy should be considered only if price sustains below ₹2,200 or if profitability metrics weaken significantly. Otherwise, continue holding for compounding returns and dividend income.
✅ Positive
- Strong ROE (36.5%) and ROCE (48.8%).
- PEG ratio (0.77) highlights attractive growth potential.
- Debt-free balance sheet (Debt-to-equity 0.00).
- Sequential PAT growth (419 Cr. → 715 Cr.).
- EPS at ₹55.3, reflecting strong earnings power.
⚠️ Limitation
- P/E (44.3) slightly above industry average (42.3), indicating premium valuation.
- Dividend yield at 0.71%, modest for income investors.
- Stock trading below DMA 200 (₹2,639), reflecting weak medium-term momentum.
📉 Company Negative News
- FII holdings reduced (-0.17%), showing declining foreign investor interest.
- DII holdings reduced (-0.28%), reflecting weaker domestic institutional confidence.
📈 Company Positive News
- Quarterly profit growth of 26.9% variation.
- Stock trading well above 52-week low (₹1,918), showing resilience.
🏭 Industry
- Defense and shipbuilding sector has long-term growth potential driven by government contracts and naval modernization.
- Industry P/E at 42.3 highlights Mazagon Dock is trading at a slight premium compared to peers.
🔎 Conclusion
Mazagon Dock is fundamentally strong with high ROE, ROCE, and earnings growth, supported by a debt-free balance sheet. It is a good candidate for long-term investment. Best strategy: accumulate between ₹2,300–₹2,400 and hold for 5+ years to benefit from compounding and dividend income. Existing holders should continue holding unless fundamentals weaken or price drops below ₹2,200.