S P Capital Fin. (530289)

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

Key Financials

Strengths

• P/E of 5.52 and P/B of 1.42 against book value of ₹40.35 provide a valuation cushion
• Reported ROE of 25.70% is strong and Piotroski F-Score of 7/9 suggests improving financial health
• Exceptional headline growth: sales up 170.23% and profit up 1,000% with a PEG ratio of 0.01
• Dividend yield of 2.58% offers some cash return while waiting for clarity

Concerns

• ROCE of 4.33% is far below ROE, indicating weak operating returns and possible reliance on leverage or non-operating income
• Debt/Equity is not available and promoter holding is N/A, leaving capital structure and governance opaque
• Extremely small scale: ₹35 Cr market cap and latest quarter sales of just ₹4 Cr make growth rates misleading and vulnerable to shocks
• 52-week range of ₹43.00 to ₹76.79 shows significant price volatility for a microcap

AI Analysis

Benjamin Graham taught me to buy with a margin of safety, and at first glance S P Capital Fin seems to offer one. The stock trades at ₹57.41, only 1.42 times book value of ₹40.35, with a P/E of 5.52. That looks cheap. A 25.70% ROE is also eye-catching, and the Piotroski F-Score of 7/9 suggests a company that has improved its financial health. But I need to be honest: a market cap of ₹35 Cr makes this a microcap, and the numbers can move dramatically on small absolute amounts. Sales are ₹4 Cr in the latest quarter and net profit is ₹2 Cr; growth of 170% and 1,000% sounds spectacular, but it is starting from a very tiny base. A single large order or investment gain can distort the picture. The more troubling number is ROCE of just 4.33%. If operating capital creates so little, the high ROE may be the result of financial leverage or non-operating items, not a durable business advantage. Debt/equity is not available, which only increases my caution. I also do not have promoter holding data; as Graham said, management is a key variable in a small company. The dividend yield of 2.58% gives some compensation, but I am not paid to wait for a story I cannot evaluate. This may be a fast grower, but it is not a simple stalwart. I would need to understand where the earnings come from, whether they are repeatable, and why capital returns differ so much between ROE and ROCE. Without that clarity, the low P/E is a trap, not an opportunity.

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