Bhatia Communic. (540956)

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

Key Financials

Strengths

• Revenue and profit growth both above 37%, indicating strong momentum
• High capital efficiency with ROE of 18.39% and ROCE of 21.81%
• PEG of 0.50 suggests the market may not be fully pricing in the growth
• Piotroski F-score of 7/9 points to reasonably sound financials

Concerns

• Latest quarter net margin is thin: ₹5 Cr profit on ₹175 Cr sales, roughly 2.9%
• Debt/Equity and promoter holding are listed as N/A, creating transparency gaps
• P/B of 3.89 leaves little asset-based margin of safety
• Dividend yield of only 0.18% means returns depend heavily on continued growth

AI Analysis

Looking at Bhatia Communic, I first ask: is this a business I can understand and value? It is a specialty retailer, and retail is a tough game—customers are fickle and competition never sleeps. The numbers, though, make me pause. Sales grew 38.36% and profits 37.15%, and with a P/E of 18.74 and a PEG of 0.50, the market is paying a reasonable price for that growth. ROE of 18.39% and ROCE of 21.81% tell me capital is being deployed well, at least for now. The Piotroski F-score of 7 out of 9 supports the idea that the financial health is decent, but I notice Debt/Equity is listed as N/A—so I cannot fully judge the leverage. That bothers me; Benjamin Graham always insisted on knowing the liabilities before trusting the earnings. Book value is only ₹6.20 against a price of ₹24.14, so I am paying 3.89 times assets. For a grower, that can be acceptable, but it removes the classic margin of safety. The latest quarter shows net profit of ₹5 Cr on sales of ₹175 Cr—a thin net margin—so any cost pressure or slowdown can hurt disproportionately. With a dividend yield of just 0.18%, the return depends entirely on continued expansion and eventual share-price appreciation. There is no promoter holding figure either, and in India I want to know how much skin the founders have in the game. If growth continues at this pace for several years, the valuation may turn out to be cheap. But retail is full of examples where rapid growth meets sudden stalls. I would need more data on same-store sales, cash conversion, debt levels, and promoter commitment before calling this a true Graham-style bargain. It is an interesting fast grower, but not yet a proven compounder.

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