MRPL - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.7
| Stock Code | MRPL | Market Cap | 31,417 Cr. | Current Price | 179 ₹ | High / Low | 185 ₹ |
| Stock P/E | 14.4 | Book Value | 75.8 ₹ | Dividend Yield | 0.00 % | ROCE | 4.36 % |
| ROE | 0.40 % | Face Value | 10.0 ₹ | DMA 50 | 155 ₹ | DMA 200 | 149 ₹ |
| Chg in FII Hold | 0.83 % | Chg in DII Hold | -0.40 % | PAT Qtr | 1,445 Cr. | PAT Prev Qtr | 639 Cr. |
| RSI | 64.5 | MACD | 6.60 | Volume | 1,98,66,049 | Avg Vol 1Wk | 2,55,18,415 |
| Low price | 98.9 ₹ | High price | 185 ₹ | PEG Ratio | -0.20 | Debt to equity | 0.81 |
| 52w Index | 93.3 % | Qtr Profit Var | 375 % | EPS | 12.4 ₹ | Industry PE | 9.70 |
📊 Analysis: MRPL trades at ₹179 with a P/E of 14.4, slightly above the industry average of 9.7, suggesting moderate overvaluation. ROE (0.40%) and ROCE (4.36%) are very weak, reflecting poor efficiency in generating returns. Dividend yield is 0%, making it unattractive for income investors. The PEG ratio (-0.20) indicates negative growth prospects relative to valuation. Technical indicators (RSI 64.5, MACD 6.60) show near overbought momentum. PAT has surged sequentially (639 Cr. → 1,445 Cr.), highlighting strong short-term earnings growth, but sustainability remains uncertain. Debt-to-equity at 0.81 indicates moderate leverage, adding financial risk.
💡 Entry Price Zone: Ideal entry would be between ₹150–₹165, closer to the DMA 200 (₹149), offering better valuation comfort and risk-reward balance.
📈 Exit / Holding Strategy: If already holding, consider a short-to-medium horizon (12–24 months) while monitoring profitability trends. Exit strategy should be triggered if price sustains below ₹150 or if ROE/ROCE fail to improve. Long-term holding is not recommended unless return metrics strengthen significantly.
✅ Positive
- Sequential PAT growth (639 Cr. → 1,445 Cr.).
- EPS at ₹12.4, reflecting improved earnings power.
- FII holdings increased (+0.83%), showing foreign investor confidence.
⚠️ Limitation
- Weak ROE (0.40%) and ROCE (4.36%).
- Dividend yield at 0%, unattractive for income investors.
- PEG ratio (-0.20) indicates poor growth prospects.
📉 Company Negative News
- DII holdings reduced (-0.40%), showing declining domestic institutional interest.
- High leverage with debt-to-equity ratio at 0.81.
📈 Company Positive News
- Quarterly profit variation of 375%, showing strong short-term performance.
- Stock trading near 52-week high (₹185), reflecting resilience.
🏭 Industry
- Oil refining sector is cyclical, highly dependent on crude prices and global demand.
- Industry P/E at 9.7 highlights MRPL is trading at a premium compared to peers.
🔎 Conclusion
MRPL shows strong short-term earnings momentum but weak long-term fundamentals with poor ROE/ROCE and no dividend support. It is not an ideal candidate for long-term investment at current levels. Best strategy: accumulate only near ₹150–₹165 for short-to-medium term gains. Existing holders should consider exiting if price drops below ₹150 or if profitability weakens.