MRF Ltd.
ISIN: INE883A01011 • Market Cap: ₹56,645 Cr
The 5-Pillar Quality Audit for MRF Ltd.
Evaluated across Profitability, Financial Health, Historical Compounding, Valuation Safety, and Ownership Governance:
1. Profitability & Capital Efficiency
Weight: 25%Measures operating margins (15.1%), Return on Capital Employed (15.9%), and equity compounding (11.6%).
2. Financial Health & Solvency
Weight: 25%Debt-to-Equity is 0.11 with comfortable interest coverage and clean working capital.
3. Growth & Compounding Track Record
Weight: 20%Historical 3Y Sales CAGR (8.2%) and 3Y PAT CAGR (5.1%).
4. Valuation Multiple & Margin of Safety
Weight: 15%Trades at P/E of 23.46 vs PEG of 1.62 and Dividend Yield of 0.2%.
5. Ownership Quality & Governance
Weight: 15%Promoter holding stands at 27.8%, backed by 29.5% institutional ownership.
Key Fundamental Strengths
Fortress Balance Sheet (D/E: 0.11)
The company operates virtually debt-free, shielding net margins from interest rate cycles and monetary tightening.
Deep Institutional Sponsorship (29.5%)
Mutual funds, domestic DIIs, and foreign FIIs hold 29.5%, providing strong governance scrutiny.
Areas to Watch & Potential Risks
Sectoral & Macro Headwinds (Automobile and Auto Components)
Subject to broader cyclical demand, raw material price shifts, and regulatory frameworks governing the Automobile and Auto Components space.
Quantitative Strategy Eligibility
Checking MRF against established Indian wealth creation frameworks:
Coffee Can Investing Framework
Passes Saurabh Mukherjea's Coffee Can rule: 10%+ sustained revenue growth and 15%+ ROCE/ROE.
Quality Factor Screener (High RoIC + Low Debt)
Scorecard of 66/100 or leverage profile sits below strict quality index hurdles.
GARP / Value-Growth Blend
Provides balanced valuation margin with strong profitability scores.
Automobile and Auto Components Sector Peer Comparison
Compare MRF directly against top industry peers by market capitalization:
| Company | 5-Pillar Score | Market Cap | P/E | ROCE | D/E | Scorecard |
|---|---|---|---|---|---|---|
| MRF Ltd. (MRF)Current | 66/100 | ₹56,645 Cr | 23.46 | 15.9% | 0.11 | — |
| Maruti Suzuki India Ltd. (MARUTI) | 71/100 | ₹4.30 Lakh Cr | 30.02 | 15.6% | 0.00 | View |
| Mahindra & Mahindra Ltd. (M&M) | 72/100 | ₹4.24 Lakh Cr | 22.97 | 16.6% | 1.43 | View |
| Bajaj Auto Ltd. (BAJAJ-AUTO) | 77/100 | ₹3.22 Lakh Cr | 27.34 | 25.4% | 0.57 | View |
| Eicher Motors Ltd. (EICHERMOT) | 74/100 | ₹2.19 Lakh Cr | 37.86 | 23.7% | 0.01 | View |
| TVS Motor Company Ltd. (TVSMOTOR) | 68/100 | ₹2.07 Lakh Cr | 60.46 | 29.9% | 3.31 | View |
Frequently Asked Questions: MRF Ltd.
Q:What is the 5-Pillar Fundamental Score for MRF Ltd. (MRF)?
MRF Ltd. has a RupeeTools Fundamental Score of 66/100, placing it in the 'Solid & Healthy' category. Its pillar scores are: Profitability (63/100), Financial Health (77/100), Growth (55/100), Valuation (70/100), and Ownership Quality (60/100).
Q:Is MRF fundamentally strong for long-term investment?
MRF currently holds a moderate quality rating of 66/100. While it operates in the Automobile and Auto Components sector, investors should monitor its profit margins before initiating long-term positions.
Q:Does MRF pass the Coffee Can Investing filter?
Yes! MRF satisfies both core pillars of Coffee Can Investing: achieving consistently high capital returns (ROCE/ROE >= 15%) alongside double-digit multi-year revenue growth.
Q:How does MRF compare against other Automobile and Auto Components peers?
Within India's Automobile and Auto Components sector, MRF trades at a P/E of 23.46 and generates an ROCE of 15.9%. Compare its 5-Pillar score of 66/100 against top sector peers like Maruti Suzuki India Ltd. (71/100), Mahindra & Mahindra Ltd. (72/100).
Regulatory & SEBI Research Analyst Compliance Disclaimer:
This 5-pillar fundamental score is an automated quantitative health check generated purely from historical public financial statements, corporate filings, and exchange disclosures for educational and informational purposes only. It does NOT constitute investment advice, a stock recommendation, or a solicitation to buy or sell securities. RupeeTools is not a SEBI-registered Research Analyst. Please consult a SEBI-registered financial advisor before making investment decisions.