PGHH - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 3.6
| Stock Code | PGHH | Market Cap | 38,826 Cr. | Current Price | 11,965 ₹ | High / Low | 14,680 ₹ |
| Stock P/E | 45.2 | Book Value | 287 ₹ | Dividend Yield | 1.43 % | ROCE | 104 % |
| ROE | 75.7 % | Face Value | 10.0 ₹ | DMA 50 | 12,527 ₹ | DMA 200 | 13,334 ₹ |
| Chg in FII Hold | -0.05 % | Chg in DII Hold | -0.02 % | PAT Qtr | 301 Cr. | PAT Prev Qtr | 210 Cr. |
| RSI | 38.4 | MACD | -246 | Volume | 12,766 | Avg Vol 1Wk | 13,746 |
| Low price | 11,612 ₹ | High price | 14,680 ₹ | PEG Ratio | -53.8 | Debt to equity | 0.00 |
| 52w Index | 11.5 % | Qtr Profit Var | 12.2 % | EPS | 265 ₹ | Industry PE | 47.2 |
📊 Analysis: Procter & Gamble Hygiene and Health Care (PGHH) demonstrates exceptional efficiency with ROCE at 104% and ROE at 75.7%, reflecting strong profitability and capital utilization. The company is debt-free, which adds financial stability. However, the stock trades at a high P/E of 45.2, close to the industry average of 47.2, suggesting fair but expensive valuation. The PEG ratio of -53.8 indicates growth concerns relative to price. Dividend yield of 1.43% provides modest income. Technical indicators (RSI 38.4, MACD negative) suggest weakness and possible consolidation. Ideal entry zone lies between ₹11,600–₹12,000, closer to support levels.
📈 Exit Strategy: If already holding, investors should maintain positions for 3–5 years to benefit from strong fundamentals and consistent dividend payouts. Partial profit booking can be considered near ₹14,000–₹14,500 if valuations stretch further. Long-term holding is justified due to strong ROE/ROCE and debt-free balance sheet, though growth visibility needs monitoring.
✅ Positive
- Exceptional ROCE (104%) and ROE (75.7%) show strong efficiency.
- Debt-free balance sheet ensures financial stability.
- EPS of ₹265 with consistent profitability.
- Dividend yield of 1.43% provides steady income.
⚠️ Limitation
- High P/E (45.2) indicates expensive valuation.
- PEG ratio of -53.8 highlights weak growth relative to price.
- Low trading volumes compared to peers.
- Institutional investors reduced holdings (FII -0.05%, DII -0.02%).
📉 Company Negative News
- Weak PEG ratio suggests limited growth prospects.
- Stock trading below DMA 200 (₹13,334) shows weak long-term trend.
- Institutional selling pressure observed.
📈 Company Positive News
- Quarterly PAT improved from ₹210 Cr. to ₹301 Cr. (+12.2%).
- Debt-free structure strengthens investor confidence.
- Strong brand presence in FMCG healthcare products.
🏭 Industry
- Industry PE at 47.2 indicates sector is fairly valued.
- FMCG healthcare sector benefits from rising demand for hygiene and wellness products.
- Defensive sector with stable demand even in economic downturns.
🔎 Conclusion
PGHH is a fundamentally strong company with exceptional ROE/ROCE and a debt-free balance sheet. Ideal entry is around ₹11,600–₹12,000 for better valuation comfort. Existing investors should hold for 3–5 years, with partial profit booking near ₹14,000–₹14,500. While growth prospects are modest, the company remains a stable long-term compounder in the FMCG healthcare space.