Star Housing Fin (539017)

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

Key Financials

Strengths

• Sales growth of 7.45% shows moderate business momentum.
• ROCE of 12.10% suggests acceptable capital productivity at the operating level.
• Dividend yield of 1.47% provides a small income cushion.
• P/E of 8.11 could appear attractive if the 75.98% profit decline proves temporary.
• Book value of ₹20.06 gives a tangible asset floor.

Concerns

• Profit growth is -75.98% and latest quarterly net profit is ₹0 Cr, making the reported P/E unreliable.
• ROE of 4.74% is far too low to justify a P/B of 2.44.
• Piotroski F-Score of 4/9 indicates weak financial health.
• No debt-to-equity data for a housing finance company is a red flag for leverage risk.
• The stock trades at its 52-week high of ₹48.92 after a massive run from ₹3.67, with much optimism already priced in.

AI Analysis

At ₹48.92, Star Housing Fin has had a remarkable run—from ₹3.67 to the top of its 52-week range—but my first thought is the blunt one: am I buying earnings or hopes? Book value is ₹20.06, so paying ₹48.92 means 2.44 times book. For a housing finance company with an ROE of only 4.74%, that is a rich price; you need a wide moat and strong returns when you pay above book. I do not see that moat. Sales grew 7.45%, respectable but not exciting, while profit fell 75.98%. The latest quarter shows sales of ₹26 Cr and net profit of ₹0 Cr—the engine has stalled. The reported P/E of 8.11 looks cheap at first glance, but it sits uneasily with the ROE of 4.74% and the zero quarterly profit, so it should not be trusted without clarity on one-off items. The Piotroski F-Score of 4 out of 9 reinforces caution: financial health is mediocre. ROCE of 12.10% is decent, but it is not a franchise. Debt-to-equity is not disclosed, and for a lender that is a serious gap. A 1.47% dividend offers some comfort, but it is thin compensation for the risks. This feels like a cyclical business; housing finance moves with credit and real-estate cycles. If the cycle turns upward, profits could recover sharply, but I need evidence before calling it a turnaround. Graham said price is what you pay, value is what you get. At 2.44 times book for a 4.74% return on equity, I worry the price already contains a lot of optimism. Let the business prove itself first.

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