Stovec Inds. (504959)

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

Key Financials

Strengths

• Book value of ₹589.18 per share provides a tangible asset reference point.
• Return on capital employed is still positive at 7.14%, so operations generate some return above zero.
• Dividend yield of 6.30% offers an income buffer, if the payout is sustained despite weak earnings.
• Latest quarter sales of ₹51 Cr show the business continues to function and has a revenue base.

Concerns

• Profit growth collapsed by 89.54% and latest quarter net profit is ₹0 Cr, so current earnings power has nearly disappeared.
• P/E of 55.32 and P/B of 5.34 are far too high for ROE of 5.52% and ROCE of 7.14%.
• Piotroski F-Score of 3/9 and FairStock Score of 0/100 indicate serious financial health risk.
• Sales declined 8.21%, and debt/equity is not disclosed, leaving the balance-sheet risk unclear.

AI Analysis

Let's call this what it is: a business whose earnings have collapsed. Over the latest year, profits fell 89.54%, and sales fell 8.21%. The latest quarter earned net profit of ₹0 Cr on ₹51 Cr of sales. I cannot value a company on a P/E of 55.32 when the 'E' has nearly vanished; that is a trailing mirage, not a dependable earnings stream. The Piotroski F-score of 3 out of 9 reinforces my concern: the financial fabric is weakening. Return on equity is only 5.52%, and return on capital employed is 7.14%. At a price-to-book of 5.34 and book value of ₹589.18, the market is asking me to pay ₹3,145.40 for ₹589.18 of book value that earns just over five and a half percent. That is not a margin of safety; it is a margin of hope. The 6.30% dividend yield attracts attention, but with profits down nearly 90%, I do not know how durable that payout is. Also, debt/equity is not available in the data, so I cannot conclude the balance sheet is safe. The stock price is at the top of its 52-week range, but price action never made a good investment. The business may one day recover — industrial products have a way of cycling — but no data point shown here gives me a clear turnaround signal. The FairStock score of 0/100 is an honest warning. Graham would say price is what you pay, value is what you get. What I get from the numbers is poor earnings, weak returns, and a high valuation. I will stay on the sidelines and revisit if earnings stabilise and the price falls to a level that actually compensates me for the risks.

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