Nirlon (500307)

FairStock Score: 51/100 — MIXED

Score breakdown: P/E: 2/3 · ROCE: 2/2 · Growth: 2/2 · Dividend: 1/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Let's assess Nirlon as Graham and Buffett would. The first numbers that jump out are an 86.51% ROE and 30.18% ROCE. Those are exceptional; a business that can earn nearly 87 rupees on every 100 rupees of equity has an unusual economic characteristic. But I must be careful with a price-to-book of 9.93 and book value of only ₹42.37. I am paying ₹420.90 for ₹42.37 of stated book; the market is paying for the franchise, not the net assets. The 13.63 P/E tempers that premium, and a 5.23% dividend yield rewards me while waiting. Profit growth of 18.90% against sales growth of 5.32% suggests margins and operating leverage are doing the heavy lifting. That can be good, but it also means top-line isn't driving the story. Sales growth of only 5.32% would not satisfy me as a compounding machine; it points to a mature, stable business rather than a fast grower. The Piotroski score of 7/9 tells me the financial condition is decent. Yet I lack debt/equity and promoter holding data; in India, promoter alignment matters, and I won't blind myself. The stock sits at ₹420.90, below the 52-week range of ₹445-633, so Mr. Market is unhappy. I need evidence the recent results—quarterly sales ₹170 Cr, net profit ₹69 Cr—are repeatable. Valuation is reasonable on earnings, but high on book. FairStock score of 51 calls it mixed. I would categorize this as a Stalwart: steady, profitable, dividend-paying, but not a rapid grower. I'd wait for a margin of safety or proof that profit growth isn't just a one-time margin bump.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer