Indian Wood Prod (540954)

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

Key Financials

Strengths

• Price ₹32.06 is at a 42% discount to book value ₹55.13, giving a P/B of 0.58.
• Latest quarter remains profitable with ₹1 Cr net profit on ₹53 Cr sales.
• Market cap of ₹205 Cr is roughly 1x trailing annualised sales, not demanding on a turnover basis.
• Stock trades nearer the lower end of its 52-week range of ₹27.00–₹51.00, suggesting much pessimism is already priced in.

Concerns

• ROE of 1.01% and ROCE of 3.32% are far below acceptable return thresholds, indicating poor capital productivity.
• Profit declined 18.70% and sales fell 3.05%, with P/E at 41.41 giving no margin of safety on earnings.
• Piotroski F-Score of 3/9 suggests weak financial health and deteriorating fundamentals.
• Dividend yield of only 0.44% provides negligible income while waiting for any potential turnaround.

AI Analysis

When I see a stock trading at ₹32.06 against a book value of ₹55.13, my Graham instincts pay attention. A P/B of 0.58 suggests the market is offering me one rupee of book for 58 paise. But as Buffett would say, price is what you pay, value is what you get — and here the business is not earning anywhere near a satisfactory return. ROE is just 1.01% and ROCE is only 3.32%, both below what a bank fixed deposit would offer. Sales fell 3.05% and profit fell 18.70%. The latest quarter shows ₹53 crore of revenue producing just ₹1 crore of net profit — a razor-thin margin. At a P/E of 41.41, I am being asked to pay 41 times current earnings for a company whose earnings are shrinking. That is not a growth multiple; it is an expensive multiple for stagnation. The Piotroski F-Score of 3/9 reinforces my caution — this is not a financially improving business. So what do I really own here? Possibly some asset backing. But a valuable business must convert its assets into equity returns. This one is barely doing that. I would not call it a compounder or a stalwart. It is closer to a statistical asset play, but only for someone willing to wait and accept that the book value may erode if losses persist. I would need evidence of improving capital allocation, stabilised sales, and higher returns on equity before buying this as a value investment. For now, the discount is not enough.

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