Riddhi Corporate (540590)
TurnaroundScore breakdown: P/E: 3/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹78.64 |
| Market Cap | ₹93.32 Cr |
| P/E Ratio | 7.74 |
| ROCE | 13.65% |
| ROE | 16.32% |
| Dividend Yield | 0.78% |
| Profit Growth | -64.52% |
| Debt/Equity | — |
| Sales Growth | 126.64% |
| 52-Week Range | ₹50.75 — ₹82.65 |
| Sector | IT - Services |
| Book Value | ₹50.02 |
Strengths
- Low P/E of 7.74 and P/B of 1.57 offer some valuation cushion if profitability stabilizes.
- ROE of 16.32% and ROCE of 13.65% are decent; book value of ₹50.02 provides support.
- Sales growth of 126.64% shows strong business momentum and market demand.
- Latest quarter sales of ₹135 crore indicate a sizeable revenue base relative to market cap.
Concerns
- Profit growth of -64.52% and thin net margin (~2.2%) signal deteriorating earnings quality.
- Piotroski F-Score of 4/9 suggests weak overall financial health and possible operational stress.
- Promoter holding is undisclosed, raising governance and transparency concerns.
- Dividend yield of just 0.78% offers little return support, and Debt/Equity is not provided to assess leverage.
AI Analysis
What have we here? A company with sales up 126% yet profits down 64.5% — that immediately sets off alarm bells. Riddhi Corporate trades at ₹78.64, a P/E of 7.74, and a P/B of 1.57 against book value of ₹50.02. The market cap is only ₹93 crore. On the surface, a P/E under 8 looks cheap, but cheap can be a trap when earnings are falling. The latest quarter shows ₹135 crore in sales but just ₹3 crore in net profit — a razor-thin margin of about 2.2%. That suggests the business is buying revenue, perhaps at the expense of profitability. ROE of 16.32% and ROCE of 13.65% are respectable, but those are trailing figures and could deteriorate if profit keeps sliding. A Piotroski F-Score of 4/9 is weak, flagging poor financial health. The PEG ratio of 0.06 is meaningless when profit growth is negative — I'd ignore it. There is also no promoter holding data, which is a red flag for governance transparency. I prefer businesses with predictable earnings and a clear competitive moat. This looks more like a high-revenue, low-quality enterprise trying to find its footing. The declining profits and thin margins make it a potential value trap unless operations genuinely turn around. I'd demand a margin of safety and wait for evidence of stabilizing margins before touching it.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer