CG-VAK Software (531489)
Slow GrowerScore breakdown: P/E: 3/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹401.05 |
| Market Cap | ₹208.63 Cr |
| P/E Ratio | 8.07 |
| ROCE | 18.73% |
| ROE | 21% |
| Dividend Yield | 0.52% |
| Profit Growth | 20.9% |
| Debt/Equity | — |
| Sales Growth | -5.52% |
| 52-Week Range | ₹161.95 — ₹401.05 |
| Sector | IT - Software |
| Book Value | ₹109.06 |
Strengths
- Debt-free balance sheet with D/E not applicable, implying low financial risk
- Strong ROE of 21% and ROCE of 18.73% show efficient capital use
- P/E of 8.07 and PEG of 0.39 indicate possible undervaluation if earnings hold
- Piotroski F-score of 6/9 suggests overall sound financial health
- Profit grew 20.90% despite lower sales, showing some operating resilience
Concerns
- Sales declined 5.52%, indicating weak top-line momentum
- P/B of 3.68 means investors pay a hefty premium over book value
- Tiny revenue base of ₹19 Cr in latest quarter limits scalability and bargaining power
- Dividend yield of only 0.52% offers little compensation while waiting for growth
AI Analysis
When I look at CG-VAK Software, I see a small-cap IT firm trading at a P/E of 8.07, which is certainly cheap on the surface. A 21% ROE and an 18.73% ROCE are numbers that would please any owner, and with debt/equity not applicable, this looks like a debt-free balance sheet. But Graham taught me to dig deeper. Sales fell by 5.52% last year—that is a red flag for a software company where growth is the lifeblood. Profit growth of 20.90% is encouraging, yet I must question whether it came from operations or one-off items. With latest quarterly sales of ₹19 Cr and net profit of ₹3 Cr, margins are healthy, but the scale is tiny. The stock trades at ₹401 against a book value of ₹109, so I am paying 3.68 times book for a business whose top line is shrinking. The PEG of 0.39 suggests the market expects strong future earnings growth, but if that growth does not materialise, the low P/E could be a value trap. The dividend yield is just 0.52%, so I am not being paid well to wait. At the 52-week high of ₹401, there is no margin of safety on price. I would categorise this as a slow grower with a decent franchise but no meaningful moat. The small size and falling sales leave it vulnerable to competition and client concentration. I would wait for evidence of resumed growth or a lower price before committing capital.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer