Lime Chemicals (507759)

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

Key Financials

Strengths

• ROCE is positive at 5.63%, indicating some operating return despite negative ROE.
• Book value is positive at ₹2.56 per share, so the company is not insolvent on paper.
• Latest quarter net profit of -₹0 Cr is essentially breakeven, suggesting the bleeding may be close to stopping.

Concerns

• ROE is -9.81% and profit growth is -233.33%, so shareholders' capital is being destroyed.
• Sales fell 41.15%, and the latest quarterly revenue is only ₹2 Cr—the business is shrinking sharply.
• At ₹29.50, the stock trades at 11.52 times book value with zero earnings and zero dividend—speculative pricing.
• Piotroski F-Score of 3/9 and missing promoter/debt data mean very weak financial transparency and health.

AI Analysis

As a value investor, I look for a business I can understand, a durable moat, and a margin of safety. Lime Chemicals is a commodity chemical producer, so the first test fails—there is no pricing power in commodities. The numbers are worse. At ₹29.50, I am asked to pay 11.52 times book of ₹2.56 for a company whose return on equity is -9.81%. That is capital destruction. A P/E of 0.00 is not cheap; it simply means earnings are absent or negligible. Sales have collapsed 41.15%, and the latest quarter brings only ₹2 crore of revenue with essentially zero net profit. This is not a growth story—it is a shrinking business. Profit growth of -233.33% confirms the deterioration. There is no dividend to compensate me as a patient shareholder. The Piotroski F-Score of 3/9 tells me the financial health is weak. Promoter holding, debt/equity, and the FairStock score are unavailable, so I cannot verify who is running this ship, how much debt supports it, or get a reliable quality score. In Graham's language, this is speculation, not investment. The stock sits at its 52-week high of ₹29.50 while fundamentals deteriorate—a dangerous gap. A positive ROCE of 5.63% is the only faint sign that the underlying operations produce some return, and the negligible latest-quarter loss hints at possible stabilisation. But I need evidence of a durable turnaround: rising sales, positive earnings, improving return on equity. Until then, this belongs in the 'too hard' pile. A rational investor must not confuse a rising price with a healthy business. In commodity chemicals, with no moat and a 41% drop in sales, price and value have parted ways.

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