Natl. Plastic (526616)

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

Key Financials

Strengths

• P/E of 7.84 and P/B of 1.51 offer a statistically cheap valuation, with PEG of 0.30.
• Piotroski F-Score of 7/9 indicates sound recent financial health.
• Profit growth of 38.78% with sales growth of 13.96% shows positive momentum and expanding margins.
• Latest quarter's ₹31 Cr sales and ₹2 Cr net profit broadly support the annual earnings implied by the P/E.

Concerns

• ROCE of 9.43% is well below ROE of 14.08%, suggesting possible leverage; debt/equity is not disclosed.
• No dividend, promoter holding N/A, and only ₹63 Cr market cap create information and liquidity risk.
• Profit growth is far ahead of sales growth, so margin expansion—not broad demand—is driving earnings; this could reverse.
• Price near the ₹70.10 52-week high leaves limited near-term margin of safety.

AI Analysis

At ₹66.42, Natl. Plastic is a tiny ₹63 Cr market-cap player in industrial plastics. On the surface, the numbers look inviting: P/E of 7.84, P/B of 1.51, Piotroski score of 7/9, and profit growth of 38.78% on sales growth of 13.96%, giving a PEG of only 0.30. But Graham taught me that a cheap multiple is not proof of a bargain. ROE is 14.08%, yet ROCE is only 9.43%. That gap is a warning: the equity return may be boosted by leverage, and the debt/equity figure is not available, so I cannot size the hidden risk. The latest quarter—₹31 Cr sales and ₹2 Cr net profit—annualises to roughly the ₹8 Cr earnings that the current P/E assumes. So the market is not ignoring recent performance. The real issue is quality and durability. This is a small, industrial plastic-products manufacturer, paying no dividend, with no promoter holding disclosed. I see no evidence of pricing power or a moat; 38.78% profit growth far ahead of 13.96% sales growth means margin expansion is driving the jump, and margins in a cyclical manufacturing business can reverse quickly. The stock is near its ₹70.10 52-week high, so optimism has already lifted the price. At 7.84 times earnings, this could be a genuine opportunity if the growth is durable—or a classic cyclical value trap if earnings are peaking. Without debt details, promoter information, cash-flow confirmation, and a longer history, I would not treat it as a long-term compounder. I would keep it on a watch list and demand a wider margin of safety.

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