Warren Tea (508494)

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

Key Financials

Strengths

• Price is 36% below book value (₹50.46 vs ₹78.70), offering potential asset-backed downside cushion.
• Latest quarter reported a positive net profit of ₹1 Cr despite zero sales, indicating some residual value.
• Small market cap of ₹60 Cr leaves room for corporate action, asset sale, or value unlocking.
• Positive ROCE of 1.47% suggests capital employed is not completely impaired.

Concerns

• Zero sales in the latest quarter; the tea operating business appears dormant or non-operational.
• Negative ROE of -2.47% and profit growth down -72.15% show no earnings power or momentum.
• Piotroski F-Score of 3/9 points to weak financial health and possible value erosion.
• No dividend yield and a meaningless P/E of 0.00 mean shareholders receive no income while waiting.

AI Analysis

At ₹50.46, Warren Tea is selling at only 0.64 times book value of ₹78.70. Graham would draw me to such a discount, but he would also require a margin of safety in earning power. Here the earning power is missing. Return on equity is -2.47%, return on capital employed is just 1.47%, and the latest quarter shows sales of ₹0 crore with an insignificant ₹1 crore profit. The market cap is ₹60 crore, so that profit translates into a meaningless earnings yield. Profit growth has collapsed by 72.15% and there is no dividend. This is not a business that rewards patient owners through compounding. Tea is a commodity product; without pricing power or scale, a small listed tea company has no obvious moat. The Piotroski F-Score of 3 out of 9 warns of weak financial health. The only real attraction is the balance sheet: if the stated book value of ₹78.70 is genuine and realisable, shareholders possess a large margin of safety. But I have learned that assets at book value often fail to become cash unless management is willing and able to unlock them. With zero sales in the latest quarter, the company appears more like a shell or asset holding company than a going concern. I cannot call it a stalwart or a fast grower. It is an asset play, and a speculative one at that. I would not rely on the low P/B alone. I need evidence that book value can be realised or operations can be revived. Until then, this remains a what-is-it-worth situation, not a what-can-it-earn situation.

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