Raghunath Intl. (526813)

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

Key Financials

Strengths

• Price is 48% of book value, offering potential margin of safety if assets are real
• Low trailing P/E of 4.91 and ROCE of 20.40% show past capital efficiency
• Tiny market cap of ₹6 Cr makes this a possible niche asset play
• Book value of ₹23.47 per share provides a yardstick against price of ₹11.30

Concerns

• Latest quarter has zero sales and zero net profit, with sales growth at -100%
• Profit growth is -33.33% and Piotroski F-Score is only 3/9
• No dividend is being paid, so value depends solely on asset recovery or turnaround
• Promoter holding is undisclosed, reducing transparency for minority investors

AI Analysis

Let me begin with what I can see. This is a cigarette/tobacco company with a market cap of just ₹6 crore, trading at ₹11.30 per share against a book value of ₹23.47. At 0.48 times book, the market is deeply skeptical. In Graham's language, I am asked to buy a rupee of net assets for 48 paise. But a bargain only works if the assets are real and the business can eventually earn a return. What troubles me is the absence of current commerce. Sales growth is shown as -100%, and the latest quarter has zero sales and zero net profit. The trailing P/E of 4.91 and ROE of 8.21% are backward-looking candles, not evidence of future earning power. A company with no revenue cannot be valued on earnings; it must be valued on the balance sheet. So this is not an ongoing enterprise, but an asset situation. Moat? In tobacco, brands and distribution can be moats, but with no sales, whatever moat existed has not produced recent results. ROCE of 20.40% suggests past capital efficiency, but zero revenue makes that ratio stale. The Piotroski score of 3 out of 9 is a clear warning flag: financial health is weak. There is no dividend, so minority shareholders are wholly dependent on asset realization or a turnaround. At a 52-week range of ₹9.01 to ₹16.00, the stock sits near the lower end, consistent with market frustration. What would I do? I cannot rely on hope. I need to examine the balance sheet: is book value composed of cash, land, inventory, or receivables? If the assets are genuine and conservatively stated, the 52% discount might protect me. But if the assets are worth less than carried, or liabilities hide behind the N/A debt-equity, the margin of safety is an illusion. I would not buy unless management proves capital allocation and the business begins generating cash again.

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