REDINGTON - Investment Analysis

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

Investment Rating: 4.1

📊 Fundamental & Valuation Analysis

Redington Ltd stands out as a strong long-term candidate in the tech distribution space, with solid financials and attractive valuations.

🔍 Key Metrics Breakdown

Metric Value Interpretation

Market Cap ₹22,503 Cr Mid-to-large cap stability

Current Price ₹288 Near support zone

Book Value ₹112 P/B ~2.57 → Reasonable

Stock P/E 19.2 Undervalued vs Industry PE (34.4)

ROE 14.4% Strong return on equity

ROCE 18.9% Efficient capital usage

Dividend Yield 2.36% Attractive for income investors

Debt-to-Equity 0.32 Low leverage, healthy balance sheet

PEG Ratio -6.74 Likely due to temporary earnings dip

EPS ₹20.5 Solid earnings base

PAT Qtr ₹303 Cr Slight dip from ₹400 Cr, but still robust

📉 Technical & Trend Analysis

RSI (40.7): Mildly oversold, potential bounce

MACD (-0.58): Bearish crossover, short-term weakness

DMA 50 & 200: Price near 50 DMA, well above 200 DMA → long-term uptrend intact

Price Trend: Up ~73% YoY, outperforming sector

✅ Long-Term Investment Outlook

Redington is a high-quality compounder with

Strong ROE/ROCE

Consistent dividend payout

Global tech distribution footprint

Low debt and attractive valuation

Despite a recent dip in quarterly profit, the long-term fundamentals remain intact. Analysts maintain a “Buy” rating with targets ranging from ₹285 to ₹350

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🎯 Ideal Entry Price Zone

Based on valuation and technical support

Buy Zone: ₹260–₹275

Near 200 DMA and historical support

Offers margin of safety and upside potential

🧭 Exit Strategy (If You Already Hold)

If you're holding Redington

🔄 Short-Term Traders

Exit near ₹320–₹335, which is a resistance zone

Use trailing stop-loss below ₹280

🕰️ Long-Term Investors

Hold for 3–5 years for compounding returns

Reassess only if ROE drops below 12% or debt spikes

Consider partial profit booking above ₹350

⏳ Suggested Holding Period

Minimum 2–3 years for capital appreciation

5+ years for dividend compounding and sectoral growth

Would you like a peer comparison with eClerx, Ingram Micro, or Sonata Software to explore alternatives in tech distribution?

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fincopanda.com

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stockanalysis.com

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