National Fitting (531289)

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

Key Financials

Strengths

• Low P/E of 13.28 and P/B of 1.94 against book value ₹70.18 offer a modest margin of safety.
• Exceptional ROE of 33.28% and Piotroski F-Score of 7/9 suggest solid reported fundamentals.
• Latest quarter net margin of ~12.5% (₹3 Cr profit on ₹24 Cr sales) with 13.54% sales growth.
• PEG of 0.14 indicates the market is not pricing in the reported 181.73% profit growth.

Concerns

• Iron & steel is cyclical; 181.73% profit growth could be a temporary upswing, not durable earnings power.
• ROCE of only 10.04% versus ROE of 33.28% raises questions about leverage or earnings quality; D/E is N/A.
• Price near 52-week low of ₹133.60, down from ₹235 high, signals market skepticism.
• Dividend yield is only 0.62%, and promoter holding/debt data are undisclosed for this small cap.

AI Analysis

At ₹136, National Fitting is a small iron and steel products company with a market cap of only ₹124 crore. On the surface, the numbers are attractive: P/E of 13.28, P/B of 1.94, book value of ₹70.18, and an ROE of 33.28%. The latest quarter shows ₹3 crore net profit on ₹24 crore sales—about 12.5% net margin. Sales grew 13.54%, profit jumped 181.73%, and with a PEG of 0.14, the market is clearly not paying much for this reported growth. A Piotroski score of 7/9 adds some comfort on financial health. But I have learned to be skeptical, especially in iron and steel. This is a cyclical, commodity-tied sector. A 181% profit jump often marks the top of an upcycle, not a permanent change in earning power. There is no wide moat here; pricing is governed by steel prices, demand, and competition. ROCE is only 10.04%, far below the headline ROE. That gap makes me ask whether leverage, non-operating gains, or a thin equity base are flattering the return on equity. Debt/equity is not provided, and promoter holding is undisclosed. For a ₹124 crore small cap, owner alignment and capital structure are critical unknowns. The share price of ₹136 is just above the 52-week low of ₹133.60 and well below the ₹235 high. The market is skeptical, and the dividend yield of only 0.62% means I am not being paid to wait. This could be a value trap if steel-cycle earnings revert. I would not call it a stalwart. It may be a fast grower if the profit surge is durable, but the burden of proof is on the business. I would wait for more evidence, monitor quarterly margins, and watch debt levels before committing. For now, this is a cyclical candidate, not a compounding machine.

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