Sugal & Damani (511654)

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

Key Financials

Strengths

• Shares trade at 0.59x book value, a 41% discount to reported book value of ₹45.62.
• Trailing P/E of 8.27 is low on reported earnings.
• Reported ROE of 21.36% and ROCE of 24.57% indicate the business was capital-efficient in the past.
• Small market cap of ₹17 Cr leaves room for a potential asset bargain if the balance sheet is genuinely strong.

Concerns

• Sales growth of -64.81% and profit growth of -73.77%; latest quarter net profit is ₹0 Cr.
• Piotroski F-Score of 3/9 signals weak financial health and possible deteriorating fundamentals.
• No dividend yield gives no compensation while waiting for any turnaround.
• Promoter holding, debt-to-equity and loan-book quality are undisclosed; current price ₹27.11 is also below the 52-week low of ₹51.25, suggesting severe distress or data issues.

AI Analysis

At ₹27.11, Sugal & Damani looks like a classic statistical bargain: a P/B of 0.59 against a book value of ₹45.62, and a P/E of 8.27. But Ben Graham taught me that a cheap price is not enough; the business must, at minimum, preserve value. This NBFC is not preserving value. Sales collapsed 64.81% and profits fell 73.77%. The latest quarter essentially broke even with ₹2 Cr sales and ₹0 Cr net profit. A lender with no current earnings has no demonstrated ability to generate returns. The reported ROE of 21.36% and ROCE of 24.57% are impressive on paper, but they are backward-looking. Today's numbers tell a different story. The Piotroski F-score of 3/9 is a red flag: weak profitability, weak operating cash flows, and deteriorating fundamentals. I also see no dividend, so I cannot be compensated while waiting. For an NBFC, my greatest concern is the quality of the asset book. I am not given loan loss data, capital adequacy, or debt-to-equity. Without that, the book value of ₹45.62 is just an opinion. The 52-week range of ₹51.25 to ₹117.70 shows the stock has fallen severely; the current price below the range suggests either a broken story or illiquidity. With a market cap of only ₹17 Cr, this is a micro-cap in the danger zone. A margin of safety cannot be calculated with missing or conflicting data. If the assets are genuinely worth book value and management is aligned, there may be an asset play. But I cannot rely on 'if' in investing. I will need proof: a return to positive quarterly profit, stable capital adequacy, no hidden NPA stress, and clearer promoter ownership. Until then, the discount to book is an invitation to check facts, not a reason to buy.

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