Tirupati Starch (524582)

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

Key Financials

Strengths

• ROE and ROCE are both above 10%, indicating adequate capital efficiency
• Latest quarter remains profitable with ₹2 Cr net profit on ₹92 Cr sales
• Book value of ₹57.68 provides some tangible asset backing
• Small market cap of ₹179 Cr offers niche focus and potential for future growth

Concerns

• Profit growth has collapsed by 66.89%, with sales down 7.34%
• Piotroski F-score of 3/9 points to weak fundamental health
• P/E of 27.85 is expensive for a company with declining earnings
• No dividend and promoter holding data not disclosed reduce transparency

AI Analysis

When I look at Tirupati Starch, the first thing I ask is whether this is the kind of business whose economics I can understand and trust. The numbers here do not make me feel comfortable. Sales have declined by 7.34% and profits have collapsed by 66.89%. In the latest quarter, the company earned just ₹2 Cr on ₹92 Cr of sales — a thin 2% margin. That is not what I call a wonderful franchise. ROE and ROCE around 10.9% and 10.4% are acceptable, but they are hardly the 15%–plus I want from a durable compounder. The Piotroski F-score of 3 out of 9 is a serious warning flag; it suggests fundamental deterioration across profitability, leverage, and operating efficiency. Mr. Market is asking for a P/E of 27.85 on a business whose earnings are falling sharply. That implies expectations of a strong recovery, not evidence of one. The price is ₹186.20, significantly above book value of ₹57.68, so I am paying more than three times net assets for a commodity-like starch business. There is no dividend, so I receive no income while I wait. In Graham's language, there is little margin of safety. The missing promoter holding data also bothers me — transparency is the bedrock of trust. This might become an interesting turnaround if sales and margins improve over the next few quarters, but today the evidence says 'too expensive for what you get.' I would rather wait on the sidelines and let the business prove itself. If it does, I can revisit; if not, I have lost nothing.

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