Colorchips New (540023)

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

Key Financials

Strengths

• Book value of ₹13.33 per share provides some asset backing; P/B of 1.21 is not an extreme speculative multiple.
• Latest quarter net profit of ₹-0 Cr suggests the near-term cash burn is minimal despite zero sales.
• No dividend obligation conserves cash while the business struggles to stabilise.
• Market cap of ₹28 Cr is small, so any genuine operational improvement could move the needle meaningfully.

Concerns

• Latest quarter sales of ₹0 Cr and sales growth of -64.71% show the top line has nearly vanished.
• P/E of 0.00, ROE of -8.39%, and ROCE of -4.76% indicate no earnings power and continuing value destruction.
• Piotroski F-Score of 2/9 signals severe financial weakness.
• Promoter holding and debt/equity are not disclosed, creating an unacceptable lack of transparency.

AI Analysis

Let me start with the obvious: this is not a business I can claim to understand deeply, and the numbers give me no reason to be confident. Colorchips New trades at ₹16.18, capitalising the company at ₹28 crore. It has no meaningful P/E because it is not earning positive profits. The latest quarter shows sales of ₹0 crore and net profit of ₹-0 crore; over the year, sales growth fell 64.71% and profit growth fell 23.08%. A business that cannot generate revenue has no moat; whatever competitive advantage it once had is not showing up in the financial statements. The financial health is poor. ROE is -8.39% and ROCE is -4.76%, so the company is destroying value with the capital it has. The Piotroski F-Score of 2/9 is a red flag; I rarely see such low scores in healthy enterprises. There is no dividend to pay me while I wait, and debt/equity and promoter holding are not disclosed. I cannot underwrite a business where ownership and liabilities are invisible. On valuation, book value is ₹13.33 per share, and the price is ₹16.18, or 1.21 times book. That is not an obviously cheap asset play. In fact, paying any premium to book is risky when the book is generating a negative return. The 52-week range of ₹11.02 to ₹23.63 shows volatility, but not value. This could be a turnaround situation, but nothing in today's figures proves a turnaround is underway. I need sales to return, losses to narrow, and returns to move toward positive before I commit capital. The smallest positive signs would matter, but today they are absent. My conclusion: this is not a wonderful business at a fair price; it is a weak business at an uncertain price. In Buffett's words, it's much better to buy a great business at a fair price, and this is not great.

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