Astal Lab (512600)

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

Key Financials

Strengths

• Sales growth of 261.27% shows strong recent demand and business expansion
• ROE of 33.17% and ROCE of 34.78% indicate high capital efficiency on a small book value
• Latest quarter revenue of ₹52 Cr against a market cap of ₹74 Cr gives meaningful sales scale
• PEG of 0.13 appears optically cheap if the high revenue growth can be sustained

Concerns

• Profit growth of -5.22% while sales surged 261% suggests severe margin compression
• P/E of 33.10 with negative earnings growth offers no margin of safety
• Piotroski F-Score of 4/9 points to weak financial health and operating quality
• Promoter holding is not disclosed, creating uncertainty about insider alignment and governance

AI Analysis

Let me start with what I like: Astal Lab has grown sales 261%, and the latest quarter's ₹52 Cr revenue shows real commercial traction. A 33% ROE and 35% ROCE are impressive at first glance. But I don't buy revenue; I buy earnings. Trailing profits are only about ₹2.2 Cr, so at ₹74 Cr market cap I am paying 33 times earnings. Graham would call that a high price for an uncertain stream. Profit growth is -5.22%; earnings are not following sales. The Piotroski score of 4/9 reinforces my concern: the financial health is weak, not robust. Book value is just ₹6.93, yet the stock trades at ₹75, over 10 times book. There is no dividend to compensate while I wait. With promoter holding unavailable, I cannot judge whether management is aligned with minority owners. The 52-week range from ₹60 to ₹103 shows how volatile this stock is. If this is a fast grower, where is the growing profit? I see a small pharma company with one explosive sales number but deteriorating profits. Value investing demands margin of safety; at 33x earnings, negative profit growth, and a poor F-score, there is none. I would keep this on a watchlist, but not in my portfolio until earnings catch up with sales and the balance sheet becomes clearer. In Buffett's terms: it's a wonderful revenue story, but not yet a wonderful business at this price.

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