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Last Updated on: 22 November, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 500878 | NSE: CEATLTD

CEAT Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: November 21, 2024, 10:21 pm

Market Cap 11,153 Cr.
Current Price 2,753
High / Low3,263/2,061
Stock P/E18.8
Book Value 1,038
Dividend Yield1.09 %
ROCE20.4 %
ROE18.1 %
Face Value 10.0
PEG Ratio0.83

Stock P/E, Current Price, and Intrinsic Value Over Time

View Share Price Target for CEAT Ltd

Competitors of CEAT Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Goodyear India Ltd 2,319 Cr. 1,0051,440/1,00039.7 2551.49 %22.0 %16.0 % 10.0
TVS Srichakra Ltd 2,678 Cr. 3,5175,097/3,47038.7 1,4041.35 %11.1 %10.6 % 10.0
JK Tyre & Industries Ltd 9,902 Cr. 362554/33213.0 1721.24 %19.3 %20.6 % 2.00
Innovative Tyres & Tubes Ltd 10.2 Cr. 5.6510.2/4.75 9.210.00 %26.6 %% 10.0
CEAT Ltd 11,153 Cr. 2,7533,263/2,06118.8 1,0381.09 %20.4 %18.1 % 10.0
Industry Average18,206.83 Cr1,549.3827.10512.741.00%19.06%16.02%6.43

All Competitor Stocks of CEAT Ltd

Quarterly Result

MonthMar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Sales2,2901,9062,4522,4132,5922,8182,8942,7272,8752,9353,0532,9632,992
Expenses2,0291,7402,2312,2792,4042,6532,6912,4902,5072,5482,5972,5462,600
Operating Profit261166220134188165203238368387456418392
OPM %11%9%9%6%7%6%7%9%13%13%15%14%13%
Other Income111176-32-142-63103-55
Interest40465055575258666770726662
Depreciation9096121109110111115117125121124127136
Profit before tax1423558-241941656170199270228139
Tax %-8%33%27%15%5%31%65%27%27%27%25%24%33%
Net Profit1532342-20259635132144208181102
EPS in Rs37.775.9310.38-4.956.242.291.948.7533.0535.7551.4244.8726.84

Last Updated: Unknown

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: Unknown

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Sales4,9925,4645,7055,4845,7666,2826,9856,7797,6109,36311,31511,943
Expenses4,5384,7905,0134,6945,0965,6526,3326,0526,6178,64310,34110,291
Operating Profit4546736927896706306527279937219741,652
OPM %9%12%12%14%12%10%9%11%13%8%9%14%
Other Income-1031672891081017-8-38
Interest1961871421019010493154179207242269
Depreciation818793108143169193277340435469509
Profit before tax16640347258746636737630448495254836
Tax %28%33%33%32%23%36%33%24%11%26%28%26%
Net Profit12027131443635923325123043271182635
EPS in Rs35.1075.4478.41108.1789.2858.8362.3557.17106.8117.6046.02158.87
Dividend Payout %11%13%13%11%13%20%19%21%17%17%26%19%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)125.83%15.87%38.85%-17.66%-35.10%7.73%-8.37%87.83%-83.56%156.34%248.90%
Change in YoY Net Profit Growth (%)0.00%-109.97%22.99%-56.51%-17.44%42.82%-16.09%96.19%-171.39%239.90%92.56%

CEAT Ltd has shown an inconsistent trend in YoY Net Profit Growth (%) in the last 11 years from 2013-2014 to 2023-2024.

Growth

Compounded Sales Growth
10 Years:8%
5 Years:11%
3 Years:16%
TTM:7%
Compounded Profit Growth
10 Years:9%
5 Years:19%
3 Years:13%
TTM:13%
Stock Price CAGR
10 Years:12%
5 Years:24%
3 Years:32%
1 Year:32%
Return on Equity
10 Years:12%
5 Years:10%
3 Years:9%
Last Year:18%

Last Updated: Unknown

Balance Sheet

Last Updated: November 15, 2024, 1:32 am

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024Sep 2024
Equity Capital34364040404040404040404040
Reserves7489931,6422,0142,3742,5662,7262,8673,2763,2323,3994,0024,160
Borrowings1,0381,1747756639248721,4982,0351,5332,2292,2951,7922,084
Other Liabilities1,3331,3381,3651,3901,5781,6692,1402,4233,2843,6583,8914,1604,513
Total Liabilities3,1533,5403,8224,1084,9175,1466,4047,3668,1339,1609,6279,99410,798
Fixed Assets1,5731,5651,5812,0322,4532,7093,1804,1604,7635,3296,0966,2716,563
CWIP27822292993263108331,069793876596684698
Investments10312195232214181184210179170182176
Other Assets1,5521,8931,7001,5811,9071,9142,2101,9542,3672,7752,7652,8583,361
Total Assets3,1533,5403,8224,1084,9175,1466,4047,3668,1339,1609,6279,99410,798

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity +5861977497023356725619561,3586191,2051,719
Cash from Investing Activity +-53-142-253-433-543-412-1,060-1,076-618-944-849-854
Cash from Financing Activity +-466-40-194-326219-20248479-731313-320-871
Net Cash Flow6715301-571058-15-409-1237-5

Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow453.00672.00-83.00126.00-254.00-242.00651.00725.00992.00719.00972.000.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days485045403943373644454239
Inventory Days5977707610175888897795661
Days Payable83716875818392111157131112123
Cash Conversion Cycle2557474059353312-16-6-14-23
Working Capital Days82110132531-12-35-25-26-28
ROCE %21%30%26%27%19%15%13%10%14%6%9%20%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthDec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024Sep 2024
Promoters47.11%47.11%47.21%47.21%47.21%47.21%47.21%47.21%47.21%47.21%47.21%47.21%
FIIs22.71%22.66%22.45%23.78%24.09%23.30%26.20%24.10%19.99%20.16%18.76%16.65%
DIIs12.72%11.68%11.15%11.72%12.92%13.60%12.20%12.92%14.29%15.91%17.09%19.75%
Public17.46%18.55%19.20%17.29%15.79%15.90%14.40%15.79%18.50%16.73%16.93%16.39%
No. of Shareholders1,41,2361,41,7251,33,4301,04,01693,40194,23291,3641,05,8751,16,5091,14,3971,38,3151,43,063

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
Mirae Asset Large & Midcap Fund1,546,2681.14397.24387,9022024-11-21298.62%
Mirae Asset Midcap Fund875,3631.49224.88387,9022024-11-21125.67%
Mirae Asset ELSS Tax Saver Fund844,2580.97216.89387,9022024-11-21117.65%
Mirae Asset Great Consumer Fund387,9022.9799.65387,9022024-11-210%
Aditya Birla Sun Life Small Cap Fund154,8560.8439.78387,9022024-11-21-60.08%
Mirae Asset Multicap Fund136,9671.3135.19387,9022024-11-21-64.69%
ICICI Prudential Transportation and Logistics Fund126,8291.1532.58387,9022024-11-21-67.3%
Sundaram Aggressive Hybrid Fund120,0000.6730.83387,9022024-11-21-69.06%
Sundaram Multi Cap Fund52,1050.5413.39387,9022024-11-21-86.57%
Aditya Birla Sun Life Special Opportunities Fund26,2090.926.73387,9022024-11-21-93.24%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue10.0010.0010.0010.0010.00
Basic EPS (Rs.)158.8746.0317.60106.8157.17
Diluted EPS (Rs.)158.8746.0317.60106.8157.17
Cash EPS (Rs.)277.70159.08117.93181.86120.98
Book Value[Excl.RevalReserv]/Share (Rs.)1001.82854.64814.92825.59724.74
Book Value[Incl.RevalReserv]/Share (Rs.)1001.82854.64814.92825.59724.74
Revenue From Operations / Share (Rs.)2952.652797.252314.811881.241675.85
PBDIT / Share (Rs.)413.34244.93178.29246.42184.02
PBIT / Share (Rs.)287.55128.9170.70162.46115.66
PBT / Share (Rs.)206.6560.8016.35110.6570.97
Net Profit / Share (Rs.)151.9143.0610.3497.9052.62
NP After MI And SOA / Share (Rs.)158.8846.0217.60106.8157.17
PBDIT Margin (%)13.998.757.7013.0910.98
PBIT Margin (%)9.734.603.058.636.90
PBT Margin (%)6.992.170.705.884.23
Net Profit Margin (%)5.141.530.445.203.13
NP After MI And SOA Margin (%)5.381.640.765.673.41
Return on Networth / Equity (%)15.895.412.1713.027.95
Return on Capital Employeed (%)20.549.505.2012.929.26
Return On Assets (%)6.431.930.775.313.14
Long Term Debt / Equity (X)0.230.410.520.400.56
Total Debt / Equity (X)0.400.600.640.410.64
Asset Turnover Ratio (%)1.221.210.000.990.99
Current Ratio (X)0.630.640.720.730.79
Quick Ratio (X)0.360.370.360.360.39
Inventory Turnover Ratio (X)6.056.040.004.104.04
Dividend Payout Ratio (NP) (%)7.556.52102.260.0041.98
Dividend Payout Ratio (CP) (%)4.211.8514.370.0019.11
Earning Retention Ratio (%)92.4593.48-2.260.0058.02
Cash Earning Retention Ratio (%)95.7998.1585.630.0080.89
Interest Coverage Ratio (X)6.214.093.485.684.93
Interest Coverage Ratio (Post Tax) (X)3.501.861.263.452.61
Enterprise Value (Cr.)12411.067904.075853.147657.425050.49
EV / Net Operating Revenue (X)1.040.690.621.010.74
EV / EBITDA (X)7.427.988.127.686.79
MarketCap / Net Operating Revenue (X)0.900.510.400.820.46
Retention Ratios (%)92.4493.47-2.260.0058.01
Price / BV (X)2.681.711.151.901.09
Price / Net Operating Revenue (X)0.900.510.400.820.46
EarningsYield0.050.030.010.060.07

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of CEAT Ltd as of November 22, 2024 is: 3,570.61

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

As of November 22, 2024, CEAT Ltd is Undervalued by 29.70% compared to the current share price 2,753.00

Intrinsic Value of CEAT Ltd as of November 22, 2024 is: 4,380.43

Calculation basis:

  • Intrinsic value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the intrinsic value of the stock by analyzing its fundamental indicators along with EPS growth.

As of November 22, 2024, CEAT Ltd is Undervalued by 59.11% compared to the current share price 2,753.00

Last 5 Year EPS CAGR: 22.68%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 17.50%, which is a positive sign.
  2. The stock has a low average Working Capital Days of -3.75, which is a positive sign.
  3. The company has higher reserves (2,615.31 cr) compared to borrowings (1,454.77 cr), indicating strong financial stability.
  4. The company has shown consistent growth in sales (6.67 cr) and profit (400.83 cr) over the years.
  1. The stock has a high average Cash Conversion Cycle of 20.75, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in CEAT Ltd:
    1. Net Profit Margin: 5.14%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 20.54% (Industry Average ROCE: 19.06%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 15.89% (Industry Average ROE: 16.02%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 3.5
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 0.36
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 18.8 (Industry average Stock P/E: 27.1)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.4
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

Ceat Ltd. is a Public Limited Listed company incorporated on 10/03/1958 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L25100MH1958PLC011041 and registration number is 011041. Currently Company is involved in the business activities of Manufacture of rubber tyres and tubes for motor vehicles, motorcycles, scooters, three-wheelers, tractors and aircraft. Company’s Total Operating Revenue is Rs. 9312.63 Cr. and Equity Capital is Rs. 40.45 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
Tyres & Tubes463, Dr. Annie Besant Road, Worli, Mumbai Maharashtra 400030investors@ceat.com
http://www.ceat.com
Management
NamePosition Held
Mr. H V GoenkaChairman
Mr. Anant Vardhan GoenkaVice Chairman
Mr. Arnab BanerjeeManaging Director & CEO
Mr. Paras K ChowdharyNon Independent Director
Mr. Pierre E CohadeNon Independent Director
Mr. Atul C ChokseyIndependent Director
Ms. Daisy ChittilapillyIndependent Director
Mr. Haigreve KhaitanIndependent Director
Mr. Mahesh S GuptaIndependent Director
Mr. Milind SarwateIndependent Director
Ms. Priya NairIndependent Director
Mr. Ranjit V PanditIndependent Director
Ms. Sukanya KripaluIndependent Director
Mr. Praveen PardeshiInd. Non-Executive Director

FAQ

What is the latest intrinsic value of CEAT Ltd?

The latest intrinsic value of CEAT Ltd as on 21 November 2024 is ₹3570.61, which is 29.70% higher than the current market price of ₹2,753.00.

What is the Market Cap of CEAT Ltd?

The Market Cap of CEAT Ltd is 11,153 Cr..

What is the current Stock Price of CEAT Ltd as on 21 November 2024?

The current stock price of CEAT Ltd as on 21 November 2024 is ₹2,753.

What is the High / Low of CEAT Ltd stocks in FY 2024?

In FY 2024, the High / Low of CEAT Ltd stocks is 3,263/2,061.

What is the Stock P/E of CEAT Ltd?

The Stock P/E of CEAT Ltd is 18.8.

What is the Book Value of CEAT Ltd?

The Book Value of CEAT Ltd is 1,038.

What is the Dividend Yield of CEAT Ltd?

The Dividend Yield of CEAT Ltd is 1.09 %.

What is the ROCE of CEAT Ltd?

The ROCE of CEAT Ltd is 20.4 %.

What is the ROE of CEAT Ltd?

The ROE of CEAT Ltd is 18.1 %.

What is the Face Value of CEAT Ltd?

The Face Value of CEAT Ltd is 10.0.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in CEAT Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE