Transpek Inds. (506687)

FairStock Score: 24/100 — RISKY

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

Key Financials

Strengths

• Low valuation: P/E of 9.34 and P/B of 1.14 with book value at ₹1,499.92
• Dividend yield of 2.05% offers some income while waiting for a recovery
• Net profit grew 1.88% despite a 6.80% sales decline, suggesting cost discipline
• Piotroski F-Score of 6/9 points to moderately sound financial health

Concerns

• Weak returns: ROE of only 7.39% and ROCE of 10.02% signal limited pricing power
• Sales are declining, with latest quarter revenue at ₹158 Cr and profit just ₹11 Cr
• FairStock Score of 27/100 and PEG of 4.97 indicate poor risk/reward and growth-adjusted valuation
• Debt/equity and promoter holding are unavailable, leaving capital structure and alignment unverifiable

AI Analysis

At first glance, Transpek looks like the kind of stock Ben Graham would call a bargain. At ₹1,705.90 with a market cap of ₹953 crore, it trades at 9.34 times earnings and 1.14 times book value, and the book value is ₹1,499.92. So you are paying roughly a 14% premium to net assets. But a low multiple is not a free pass. Return on equity is only 7.39% and return on capital employed is 10.02%. In a commodity chemicals business, that tells me there is no economic moat; the company is earning a barely acceptable return on its capital. The latest revenue picture does not comfort me: sales declined 6.80% over the year, and the latest quarter showed ₹158 crore of sales and ₹11 crore of net profit. Profit did grow 1.88%, but flat or rising profit on falling sales can be a result of cost cuts or accounting noise, not sustainable strength. The FairStock Score of 27/100, labeled risky, and a PEG ratio of 4.97 reinforce my caution. The dividend yield of 2.05% provides something to hold onto, and a Piotroski score of 6/9 suggests financial health is okay, but I am missing two crucial pieces: debt/equity and promoter holding, both shown as not available. Without them, I cannot calculate the real risk of leverage or whether owners' interests are strongly aligned. Also, the stock has moved from ₹864 to ₹1,705.90 within the 52-week range, so the market has already re-rated it; a low p/e today may become a lower p/e tomorrow if earnings do not follow. This is a cyclical, plain-vanilla chemical operation, not a growing franchise. I would want evidence of sales recovery, better return on capital, and fuller disclosure before putting my money at work.

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