Kalyan Capitals (538778)

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

Key Financials

Strengths

• Revenue and profit are compounding rapidly: sales growth of 123.81% and profit growth of 180.95% on a small base.
• Trailing P/E of 9.22 and a PEG ratio of 0.06 look optically cheap, though the small base distorts the PEG.
• Piotroski F-Score of 7/9 indicates improving short-term financial fundamentals.
• ROCE of 10.45% is positive, and the stock’s recent price momentum reflects improving reported performance.

Concerns

• ROE of only 2.21% means the company earns very little on shareholders’ equity; paying 2.6 times book for a 2.21% return is unattractive.
• No dividend yield offers no income cushion while waiting for the high growth to prove sustainable.
• Debt/Equity and promoter holding are not available, creating a serious transparency gap for a small NBFC.
• Latest quarter profit of ₹1 Cr on ₹10 Cr sales shows a thin net margin; growth may not be durable from such a small base.

AI Analysis

Let me start with what the numbers actually tell me. Kalyan Capitals is a small NBFC with a market cap of only ₹84 Cr. The trailing P/E of 9.22 looks cheap, but Graham taught me not to judge a business by earnings per share alone. The book value is ₹6.15, so at ₹15.96 I am paying 2.6 times book for a company that earns only 2.21% on equity. That is a poor return on capital and undermines the low P/E. The recent growth is startling — sales up 123.81% and profit up 180.95% — and the latest quarter shows ₹10 Cr sales and ₹1 Cr profit. But growth from a tiny base is a different animal than durable growth; a PEG of 0.06 is almost meaningless when profitability is this thin. I also see no dividend; if the stock does not pay me to wait, I need excellent growth and a moat. I see no clear moat here, and disclosures are incomplete: debt-to-equity is not available and promoter holding is not available. For an NBFC, leverage and insider ownership are central to trust. The Piotroski score of 7/9 suggests near-term finances are improving, but that is a mechanistic check, not an economic moat. ROCE of 10.45% is positive but not exceptional, and the stock sits at its 52-week high of ₹15.96, up from ₹4.46. At this price, Mr. Market is already celebrating the growth. Buffett would say it is far better to buy a wonderful business at a fair price than a fair business at a wonderful price. This looks like a small, improving, but low-return lender with an interesting growth story, not yet a high-quality franchise. I would wait for better numbers, better disclosure, and a lower price.

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