Tanfac Inds. (506854)
CyclicalFairStock Score: 1/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 2/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹2,120.8 |
| Market Cap | ₹2,121.25 Cr |
| P/E Ratio | 55.46 |
| ROCE | 41.76% |
| ROE | 28.62% |
| Dividend Yield | 0.22% |
| Profit Growth | -55.26% |
| Debt/Equity | — |
| Sales Growth | -2.74% |
| 52-Week Range | ₹1,632.6 — ₹2,585 |
| Sector | Chemicals & Petrochemicals |
| Book Value | ₹274.11 |
Strengths
- High historical ROE of 28.62% and ROCE of 41.76% show strong past capital efficiency.
- Latest quarter sales of ₹173 Cr indicate a meaningful revenue base in the chemicals business.
- Book value of ₹274.11 provides some underlying asset support despite the high P/B.
- Current price is 17.9% below the 52-week high, reflecting some pullback in valuation.
Concerns
- Profit growth is down 55.26% while sales are down 2.74%, showing deteriorating profitability.
- P/E of 55.46 and P/B of 7.74 are expensive for a commodity chemical company with declining earnings.
- Piotroski F-Score of 3/9 and FairStock Score of 1/100 indicate serious fundamental weakness and risk.
- Dividend yield of just 0.22% offers negligible income while waiting for any recovery.
AI Analysis
If I look at Tanfac Inds., the first thing I see is a commodity chemicals business. That immediately tells me there is likely no durable moat. In commodity chemicals, the product is the price, and the price is set by the market. Trailing P/E of 55.46 and P/B of 7.74 against a book value of ₹274.11 is an expensive valuation for a company whose profit has collapsed by 55.26%. Sales have also slipped 2.74%, and the latest quarter earned just ₹16 Cr on ₹173 Cr of revenue. That is not the kind of margin that justifies a ₹2,121 Cr market cap. The ROE of 28.62% and ROCE of 41.76% look excellent, but they are backward-looking numbers. In a cyclical downturn, high returns can mean reversion is coming. The Piotroski F-Score of 3/9 and FairStock Score of 1/100 also wave red flags. A dividend yield of 0.22% means I am getting almost nothing while I wait. The 52-week range, from ₹1,632.60 to ₹2,585.00, shows a volatile stock. As Graham would say, price is what you pay, value is what you get. At this price, I am being asked to pay a huge multiple for a business in decline. I need a margin of safety, and I do not see one here. This looks like a cyclical company in distress, not a compounding machine. I would wait for evidence of profit stabilization and a far lower price before even considering it.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer