Natraj Proteins (530119)

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

Key Financials

Strengths

• P/B of 0.57 means the stock trades at a 43% discount to book value of ₹86.58.
• Low market cap of ₹18 Cr offers a small-stock entry point, with trailing P/E of 9.57.
• Latest quarter shows ₹3 Cr net profit on ₹29 Cr sales, suggesting a possible margin improvement.
• Piotroski F-Score of 6/9 indicates moderately sound fundamentals for a small-cap commodity business.

Concerns

• ROE of 4.16% and ROCE of 1.94% show weak returns on capital and book value.
• Sales growth is -13.89%, so the top line is shrinking in a commodity edible-oil business.
• Profit growth of 1000% is from a very low base and is not necessarily sustainable.
• Zero dividend yield, plus Debt/Equity and promoter holding data unavailable, leaves risk and shareholder returns unclear.

AI Analysis

At ₹49.02, Natraj Proteins is selling for barely more than half its book value of ₹86.58, and at 9.57 times earnings. That is a classic Graham bargain price on the surface. But Ben Graham also taught us that a bargain must eventually be realized, and the business must be able to generate acceptable returns. Here the evidence is less comforting. Return on equity is only 4.16%; return on capital employed is even lower at 1.94%. That means this edible-oil player is not putting its ₹86.58 of book value to productive work. Sales have shrunk by 13.89%, and the reported 1000% profit growth is arithmetical flattery from a minuscule base—the trailing P/E of 9.57 still leaves total earnings of only about ₹1.9 Cr on an ₹18 Cr market cap. The latest quarter shows ₹3 Cr net profit on ₹29 Cr sales, a strong margin for a commodity business, so there may be a trading or inventory tailwind. If that profit can be sustained, the stock looks cheap; if not, today's margin of safety could quickly evaporate. I do not see a durable moat: edible oil is a commodity, prices are set by the market, and there is no shareholder yield—zero dividend. Debt/equity is not available to me, so leverage remains an unknown. This feels more like an asset play than a growing franchise. I would only be interested at this price if management can demonstrate improving returns on capital and stabilise revenues. Until then, low P/B alone is not enough.

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