Suraj Industries (526211)

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

Key Financials

Strengths

• Revenue growth of 316.39% shows meaningful business expansion, albeit likely from a low base.
• Latest quarter turned net positive at ₹1 Cr profit on ₹12 Cr sales, indicating a possible operating inflection.
• ROCE is positive at 3.15%, suggesting some capital productivity after the recent revenue surge.
• Stock trading near its 52-week high of ₹84.50 reflects market optimism about the recovery.

Concerns

• P/E of 0.00 and ROE of -3.56% mean there is no positive trailing earnings stream; equity holders are earning negative returns.
• P/B of 6.33 versus book value of ₹13.35 leaves no margin of safety at the current price.
• Profit growth of -42.14% despite sales growth of 316.39% points to poor cost control or margin dilution.
• Piotroski F-score of 4/9, zero dividend, and missing debt/promoter data limit confidence in financial health.

AI Analysis

Let me start with what I cannot know: promoter holding and debt details are missing, so a Grahamite must keep his wallet closed until disclosures improve. Suraj Industries trades at ₹84.50, near its 52-week high, yet the market cap is only ₹134 Cr against a book value of ₹13.35 per share. That is a price-to-book of 6.33 for a business earning a negative return on equity of -3.56%. No serious value investor pays six times book for a company that cannot earn its keep. The reported P/E of 0.00 is a red flag; trailing earnings are absent or negative, even though the latest quarter shows net profit of ₹1 Cr on sales of ₹12 Cr. Sales growth of 316% sounds exciting, but profit growth fell 42.14%, and the Piotroski F-score of 4/9 suggests weak fundamentals. In distilleries, a revenue spike without consistent profits is often a distribution story, not a franchise story. I want moats: brand pricing power, distribution control, and reliable returns on capital. ROCE is only 3.15%, barely above the cost of money, and with zero dividend the shareholder relies entirely on price appreciation. That is speculation, not investment. The 52-week move from ₹38.10 to ₹84.50 shows a hot momentum stock, but Buffett pays for progress, not price action. I would need years of consistent earnings, clean debt numbers, and proof that this 316% growth can be converted into margins and return on equity. Until then, this is not a compounder; it is a possible turnaround trying to prove itself. I will watch from the sidelines, or only with a very small position if a thorough due-diligence of the balance sheet clears the fog.

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