Pradeep Metals (513532)

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

Key Financials

Strengths

• ROE of 19.15% and ROCE of 20.62% indicate efficient use of capital.
• Piotroski F-Score of 7/9 suggests sound financial health across recent metrics.
• Latest quarter profitable: ₹7 Cr net profit on ₹84 Cr sales (~8.3% net margin).
• Positive albeit low growth: sales +5.96% and profit +6.65%.

Concerns

• P/E of 20.89 and PEG of 3.31 are expensive for single-digit growth.
• Price has fallen ~44% from 52-week high of ₹430, indicating possible negative sentiment or cyclicality.
• Debt/Equity and promoter holding are undisclosed, leaving leverage and governance unverifiable.
• Dividend yield of only 0.76% provides little support while waiting for growth.

AI Analysis

At ₹242, Pradeep Metals carries a ₹424 crore market cap, and the first things I see are decent returns--19.15% on equity and 20.62% on capital employed. Those numbers suggest a business that uses shareholder money efficiently. The Piotroski score of 7/9 also points to a healthy recent financial position. But I have to stop there. Sales grew only 5.96% and profits only 6.65%, so this is not a fast grower. Yet the market is asking 20.89 times earnings and 3.34 times book value. A PEG of 3.31 is a danger sign for me: you are paying roughly three times for one unit of growth. The latest quarter shows sales of ₹84 crore and net profit of ₹7 crore, a roughly 8.3% net margin, which is acceptable but hardly special. The stock has fallen from ₹430 to ₹242, so it looks cheaper than before, but a lower price is not the same as a bargain. I am also uncomfortable with missing data: no debt-equity ratio and no promoter holding. Graham taught me that a prudent investor must know the balance sheet and the owner's mindset. Without those, I cannot assess leverage or governance. The dividend yield of 0.76% is too small to compensate for uncertainty. If the auto component cycle slows, earnings could disappoint. I need clearer evidence of an order book, capacity expansion, or margin strength before treating this as a value buy. At this price, it is a slow grower with a growth-stock price, and that is not how I like to invest.

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