Ready for a different take on this Murugappa Group stock? Know why we think it's a perfect valuation!

This aided the stock to touch a fresh all-time high level of Rs 1,075.10 while on a YTD basis, it delivered handsome returns of 37 per cent.

Recently, Coromandel International, which is a part of one of India’s leading business conglomerates - Murugappa Group, announced its Q1FY23 earnings.   

Here are the important highlights - Standalone results:   

• Its total income in Q1 stood at Rs 5,776 crore compared to Rs 3,677 crore of the same period the previous year, registering a growth of 57 per cent over last year.  

• EBITDA for Q1 was Rs 683 crore, registering a growth of 42 per cent over Q1 of the previous year.  

• PAT for Q1 was Rs 496 crore vs Rs 329 crore in Q1 of the previous year, registering a YoY growth of 50 per cent.   

This aided the stock to touch a fresh all-time high level of Rs 1,075.10 while on a YTD basis, it delivered handsome returns of 37 per cent.   

However, here comes the twist! This article is not about Coromandel directly but instead, about finding a needle in a haystack.   

So, let’s see and understand what that is!   

EID Parry (India) Limited, which is a listed company engaged in the business of sugar & nutraceuticals, gained nearly 23 per cent on a YTD basis and has a market capitalisation (market cap) of about Rs 9,954 crore. However, here is an interesting point worth noting. EID Parry holds approximately 56.33 per cent in Coromandel International.   

Coromandel International has a market cap of Rs 30,217 crore and 56.33 per cent of that comes to Rs 17,021 crore. So, EID Parry’s holding is valued at Rs 17,021 crore. Considering a 50 per cent discount comes to Rs 8,510.10 crore. So, the standalone value of the business would be Rs 1,444 crore!

Isn’t it amazing that we are getting the entire business at such a cheap valuation? 

Share your thoughts in the comments section.  

Note: This is just the author’s viewpoint, not a recommendation!