Weekly Shorts : Analysis of Chambal Fertilizers

Current Market Price : INR 310.60

Chambal Fertilizers is one of the strongest shares and one of the many favourites of our Co-Founder, Vedant Jhawar.

With the monsoon arriving on time, there will be a significant growth in the agricultural yield of the country and thus, a significant increase in the demand of fertilizers.

Thus, it is highly recommended to own a company that manufactures fertilizers.

Chambal Fertilizers is one of the most undervalued companies in not only the fertilizer sector, but the whole stock market in general.

With P/E of 9 in comparison to the sector P/E of 20, and P/B of 2.4, Chambal Fertilizers at the current rate is undervalued by at least 30%.

Thus, there is a very significant chance of it increasing in the coming few weeks.

With a dividend yield of 2.5%, it is also a high dividend giving company while maintaining a 3 year revenue growth rate of 18% and 3 year net profit growth rate of almost 50%.

Apart from this, it has a ROE of 30.8%, which is almost twice as high as should be of any good share.

Its current P/E is at a 5 year low, almost touching 26.5 in 2017 to only 9 as of now.

Our Stance : BUY

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