Lakshmi Mills (502958)

Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1

Key Financials

Strengths

• Trades at 0.4x book value (₹5,813 vs ₹14,715.69), offering a substantial margin of safety if assets are worth book.
• Piotroski F-Score of 7/9 indicates recent improvement in fundamentals and operating efficiency.
• Sales growth of 11.65% shows some revenue traction despite weak profitability.
• Latest quarter turned a small net profit of ₹2 Cr on sales of ₹62 Cr, a possible sign of stabilization.

Concerns

• ROE is -1.81% and ROCE is only 0.86%, meaning the company earns far below acceptable returns on its large book value.
• Price of ₹5,813 is below the 52-week low of ₹6,863, indicating sustained selling pressure and market doubt.
• No dividend yield, so shareholders receive no income while waiting for value realization.
• P/E is 0.00, while debt/equity and promoter holding are N/A, creating transparency gaps.

AI Analysis

When I look at Lakshmi Mills, I see a textbook Graham-style bargain candidate on the surface, but one that fails my second test. The stock is ₹5,813 while book value stands at ₹14,715.69 — that is a 60% discount to net assets. Buy assets for 40 paise, as Graham would say, and you have margin of safety. But I have never made money in the long run buying a business solely because it is cheap. The numbers must confirm an earning power that will eventually unlock that asset value. Here, ROE is -1.81% and ROCE is only 0.86%. That tells me the company's large asset base is earning almost nothing. A low P/B can be a value trap if management cannot deploy assets at good returns. With a dividend yield of 0.00%, I am not even getting paid to wait. There are some positive signs: sales grew 11.65%, the latest quarter shows ₹62 Cr revenue and ₹2 Cr profit, and the Piotroski F-Score of 7/9 suggests improving fundamentals. Profit growth of 157.11% sounds impressive but comes from a very low or negative base, so I do not overweigh it. The market clearly disagrees with the asset value: the stock trades at ₹5,813, below its 52-week low of ₹6,863. That is a warning flag. Also, debt/equity and promoter holding are not available, so I cannot fully judge financial risk or insider ownership. Conclusion: Lakshmi Mills is an asset play, not a quality compounder. It could offer capital appreciation if management sells assets, finds a buyer, or returns capital. But until ROE turns positive and the discount narrows through action, not hope, I would keep it on the watchlist.

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