Sarup Industries (514412)

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

Key Financials

Strengths

• Positive ROCE of 5.25% shows some return on capital employed despite losses
• Tiny market cap of ₹15 Cr gives small-business acquisition optionality
• Stock has already fallen ~77% from 52-week high of ₹208, potentially discounting much bad news
• Latest quarter gross sales of ₹4 Cr indicate ongoing operations

Concerns

• ROE at -22.83% burns shareholder capital
• Sales growth -24.36% and profit growth -61.54% show steep decline
• Piotroski F-Score of 3/9 warns of poor financial health
• Net profit ₹0 Cr in latest quarter leaves no earnings to justify P/E of 72.05

AI Analysis

Let me be candid: this is not the kind of business Charlie and I would lose sleep over missing. Sarup Industries trades at ₹47.08, but the 52-week high was ₹208 — a fall of over 77%. When the market marks down a stock that violently, it is usually right. The latest quarter shows sales of just ₹4 crore and net profit of zero. Over the trailing year, sales are down 24.36% and profits down 61.54%. With a P/E of 72.05, you are paying 72 times earnings for a shrinking business. That defies arithmetic. Return on equity is a punishing -22.83%, meaning shareholders' capital is being destroyed. The only positive is ROCE of 5.25%, but that is hardly a moat. In fact, there is no moat here; footwear is a brutally competitive industry, and this company has no pricing power or scale. The Piotroski F-Score of 3 out of 9 confirms a weak balance sheet and operations. I cannot calculate book value or debt-to-equity because the data is missing — and when the numbers are not transparent, I prefer to walk away. There is no dividend to cushion the ride. In Graham's language, this is a speculative enterprise, not an investment. Some might call it a turnaround candidate, but I only invest in turnarounds when I see a credible plan and honest management. There is no sign of that here. The market cap is only ₹15 crore, so a small absolute improvement could move the stock, but that is speculation, not value investing. I would rather wait for a business with demonstrated profitability, a clear moat, and a sensible price. This one fails all three.

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