Guj. Toolroom (513337)

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

Key Financials

Strengths

• Stated P/E of 4.64 makes the stock statistically cheap if the earnings are genuine and recurring.
• ROCE of 23.96% indicates efficient use of reported capital employed.
• Piotroski F-Score of 6/9 suggests some recent financial health improvements.
• Latest quarter net profit of ₹7 Cr is positive and contributed to 407.14% profit growth.

Concerns

• Sales growth of -100.00% and latest quarter sales of ₹0 Cr: no core operating revenue exists to support the profit.
• Net profit of ₹7 Cr with zero sales likely comes from non-operating or one-time items; recurrence is doubtful.
• P/B of 26.72 against book value of ₹0.53 means negligible tangible asset protection for the price paid.
• Promoter holding is not disclosed, dividend yield is 0%, and key ratios appear internally inconsistent.

AI Analysis

I begin with the business. A plastic products toolroom that, in the latest quarter, reports sales of ₹0 Cr and net profit of ₹7 Cr. That combination is impossible to understand as a going concern. In my world, profits come from selling products or services. If there are no sales, where did the ₹7 Cr come from? Likely non-operating income or one-off gains, not a moat you can build on. The 407% profit growth and 0.01 PEG are statistical illusions: a huge percentage on an unreliable base. Graham taught me to weigh book value as a floor. Here the floor is missing: book value is ₹0.53 per share, so paying ₹14.16 means paying 26.7 times tangible book. The P/E of 4.64, on the other hand, would imply roughly ₹71 Cr of trailing earnings — but on a ₹12-13 Cr equity, that would produce ROE close to 575%, not the stated 11.64%. These figures do not tie out; when financial statements cannot be reconciled, I cannot calculate intrinsic value. ROCE of 23.96% and a Piotroski score of 6/9 look pleasant, but they are built on a mysterious earnings stream. Dividend yield is zero, promoter holding is undisclosed, and the stock has run from ₹0.41 to ₹14.16 in a year. This has speculation written all over it. I need visibility, repaying customers, and management skin in the game. None of that is visible. It may be a trader's delight, but it is not a value investor's anchor. I will pass.

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