RMC Switchgears (540358)

FairStock Score: 60/100 — STEADY

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

Key Financials

Strengths

• Revenue and profit growth are exceptionally strong at 86.07% and 90.05% respectively.
• P/E of 10.69 and PEG of 0.12 make the stock statistically inexpensive relative to recent growth.
• ROCE of 37.19% indicates efficient operating use of capital.
• Piotroski F-Score of 7/9 suggests healthy fundamentals and no immediate red flags in the financial statements.

Concerns

• ROE of 5.38% is inconsistent with the given P/E of 10.69 and P/B of 5.84, which imply an ROE of about 55%—this raises data or accounting quality doubts.
• No dividend yield means shareholders rely entirely on price appreciation and reinvestment.
• Debt/Equity and promoter holding are not available, leaving leverage and governance unclear.
• The 52-week range of ₹300.00 to ₹897.00 shows high volatility and possible momentum risk.

AI Analysis

At ₹619.25, RMC Switchgears presents one of the more contradictory sets of numbers I have come across. A P/E of 10.69 with sales growth of 86.07% and profit growth of 90.05% would normally make any value investor sit up. A return on capital employed of 37.19% and a Piotroski F-Score of 7/9 add to the healthy picture. The PEG ratio of 0.12 suggests the market is paying almost nothing for that growth. But Graham taught me that arithmetic must agree before judgment. The stated ROE is only 5.38%, yet a P/B of 5.84 combined with a P/E of 10.69 implies an ROE of roughly 55%. That huge gap alarms me. I cannot trust an analysis when one of the key figures contradicts the others. The latest quarter shows ₹195 Cr in sales and ₹19 Cr in net profit, so there is momentum, but one quarter is not a trend. Also, the company pays no dividend; with a zero yield, all my return depends on management reinvesting at excellent rates. The absence of debt-equity and promoter-holding data leaves leverage and committed ownership unknown. The 52-week range of ₹300.00 to ₹897.00 reminds me that Mr. Market has been wild here. If the growth is genuine and repeatable, the P/E is undeniably low. But I would need clarity on the ROE, the debt load, and the quality of earnings before investing. For now, I classify this as a fast grower wearing a statistical cheapness that demands more proof.

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