Balmer Law. Inv. (532485)

FairStock Score: 44/100 — MIXED

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

Key Financials

Strengths

• P/E of 9.33 and dividend yield of 5.93% provide income and valuation support.
• ROE of 51.64% shows strong return on shareholder equity.
• Piotroski F-Score of 7/9 indicates solid financial health.
• Latest quarter net profit of ₹67 Cr on ₹659 Cr sales implies roughly a 10% margin.
• Dividend yield of 5.93% with modest profit growth suggests a sustainable payout.

Concerns

• P/B of 107.60 with book value of only ₹8.54 leaves virtually no asset backing.
• Sales growth of 4.14% and profit growth of 2.45% limit intrinsic value expansion.
• PEG ratio of 2.83 suggests the stock is priced well above its growth rate.
• Price surged from ₹64.99 to ₹918.90 in 52 weeks; the steep run-up raises downside risk.

AI Analysis

Let's look at Balmer Law. Inv. through a Graham and Buffett lens. The first number that jumps out is the price-to-earnings ratio of 9.33 and a dividend yield of 5.93%. On the surface, that appears to be an inexpensive, income-generating business. But then I see the price-to-book ratio of 107.60 and book value of only ₹8.54. That tells me the equity cushion is extremely thin. A high ROE of 51.64% seems impressive, but when the denominator is that small, it can be misleading. This is not a business I can evaluate by book value; the true value must rest on its earning power and dividend capacity. The growth figures are sobering: sales grew 4.14% and profit grew just 2.45%. The PEG ratio of 2.83 suggests the market is paying a premium for this level of growth. The Piotroski F-score of 7/9 is respectable and hints at solid recent fundamentals, and the latest quarter's net profit of ₹67 Cr on sales of ₹659 Cr shows a decent margin. But I am a patient investor, not a trader. This stock has moved from ₹64.99 to ₹918.90 in 52 weeks. That kind of move creates high expectations. If earnings grow only 2.45%, the dividend may be sustainable, but the share price may have run far ahead of intrinsic value. Benjamin Graham would ask: Is there a margin of safety? At 107 times book and nearly 10 times earnings, the margin of safety comes only from the dividend. I would need to see several years of consistent, growing earnings and stable capital allocation before I could call this a quality investment. A FairStock score of 46/100 is appropriately mixed. This could be a good business, but a good business at the wrong price is a poor investment.

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