RRKABEL - Investment Analysis

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

Investment Rating: 4.1

📊 Fundamental Analysis of RR Kabel Ltd (RRKABEL)

RR Kabel is a mid-cap electrical manufacturing company with strong fundamentals and aggressive growth in both domestic and export markets. Here's how it stacks up

Metric Value Interpretation

ROE 15.2% Solid shareholder return

ROCE 19.8% Strong operational efficiency

PEG Ratio 3.97 Overvalued relative to growth; caution advised

P/E Ratio 51.9 Expensive vs industry PE of 30.3

Dividend Yield 0.43% Low, typical for growth-oriented companies

Debt-to-Equity 0.13 Very low, strong balance sheet

EPS ₹27.6 Healthy earnings base

Qtr Profit Var +64.0% Excellent quarterly growth momentum

📈 Revenue Growth: 43% CAGR from FY21 to FY23 🌍 Global Reach: Exports to 65 countries; 35 international certifications 🏭 Facilities: 5 manufacturing units across India (2 W&C, 3 FMEG)

📈 Technical & Valuation Insights

Current Price: ₹1,390

52W High/Low: ₹1,825 / ₹750

DMA 50 / DMA 200: ₹1,344 / ₹1,315 — trading above both, indicating bullish undertone

RSI (50.8): Neutral zone

MACD (18.3): Bullish crossover

Volume: Below average, suggesting consolidation

📉 Valuation Check

P/B Ratio: ~7.3 — high for manufacturing

PEG Ratio: 3.97 — signals overvaluation despite growth

🎯 Ideal Entry Price Zone

Based on valuation and technicals

₹1,300–₹1,340: Ideal accumulation zone near DMA levels

₹1,200–₹1,250: Deep value zone if broader market corrects or sentiment weakens

Avoid entry above ₹1,500 unless there's a breakout with volume confirmation.

🧭 Exit Strategy / Holding Period

If you already hold RRKABEL

Holding Period: 3–5 years to benefit from FMEG expansion, export growth, and brand premium

Exit Strategy

Partial Exit: Near ₹1,750–₹1,825 if price rallies to 52W high or valuation stretches

Full Exit: If ROE drops below 12% or PEG remains above 4 without earnings growth

Stop-Loss: ₹1,250 to protect downside

🚀 Long-Term Growth Catalysts

FMEG Expansion: Entry into fans, lighting, switches, and premium appliances

Brand Transition: From Luminous to RR Signature, boosting margins and visibility

Export Growth: Doubling export revenue in 2 years

Retail Penetration: Strong electrician network and e-commerce push

IPO Momentum: Listed at ₹1,180 with strong institutional interest

📈 2026 Target Price: ₹2,074–₹2,145

1

📈 2030 Target Price: ₹2,347–₹2,382

1

⚠️ Risks to Monitor

Valuation Stretch: PEG of 3.97 and P/E of 51.9 are high

Institutional Sentiment: DII holding down 1.13%

Competitive Pressure: From Polycab, KEI, Finolex

Execution Risk: FMEG integration and brand transition challenges

Would you like a peer comparison with Polycab, KEI, or Finolex to assess RR Kabel’s relative positioning in the wires & cables space?

1

stockpricearchive.com

Edit in a page