Nam Securities (538395)

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

Key Financials

Strengths

• Sales grew 4.48%, so the top line is not shrinking.
• Book value per share of ₹21.58 provides a measurable net asset base.
• ROCE of 4.48% is positive, indicating some return on capital employed.
• Latest quarter sales of ₹12 Cr show revenue generation, even if profit is nil.

Concerns

• P/E of 196.10 with profit growth of -40% and latest quarter net profit of ₹0 makes the earnings power unreliable and the valuation speculative.
• P/B of 5.33 against an ROE of only 1.75% means investors are paying a huge premium for very low equity returns.
• Zero dividend yield offers no cash return while waiting for any recovery.
• Piotroski F-score of 4/9, along with missing promoter holding and debt details, makes financial health opaque.

AI Analysis

Look at this business, and I see a tiny financial-services company asking for a price that assumes a future it has not earned. The market cap is ₹64 Cr, yet the market values it at 196 times earnings, even though profits fell 40%. In the latest quarter, sales were ₹12 Cr and net profit was ₹0. That is not earnings power; that is a business barely keeping its head above water. A P/E of 196 is meaningless if the E vanishes. Graham would tell me to start with the balance sheet. Book value is ₹21.58 per share, so at ₹115 I am paying 5.33 times book for an ROE of just 1.75%. In other words, I buy ₹100 of net assets that produce less than ₹2 of profit, and I pay ₹533 for it. That is the opposite of margin of safety. ROCE of 4.48% is barely above the cost of capital and far below what a stable franchise should earn. The Piotroski score of 4 out of 9 also tells me financial health is weak. Sales growth is only 4.48%, so this is not a growth story, and the PEG ratio at 43.77 is absurd. There is no dividend yield to compensate me while I wait. This is not a compounder, not a cheap asset play, and not a turnaround with evidence. It may be a cyclical in an earning trough, but without strong balance sheet data or promoter details, I cannot build conviction. At this price, the risk-reward is terrible. I would keep it on my watchlist only to see if returns on equity improve and margins recover, but the price would have to come much lower before I consider it. As Buffett says, it is far better to buy a wonderful company at a fair price than a fair company at a wonderful price. Nam Securities is neither wonderful nor fairly priced.

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