Yamuna Syndicate (540980)

FairStock Score: 58/100 — STEADY

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

Key Financials

Strengths

• Low trailing P/E of 8.26 and PEG of 0.07 on reported earnings
• Healthy Piotroski F-Score of 7/9 and Debt/Equity N/A, so no obvious leverage problem
• Strong ROE of 20.70% on book value of ₹3,296.08 per share
• Sales growth of 10.68% and dividend yield of 1.69% provide modest stability
• Profit growth of 231% shows current earnings momentum

Concerns

• Latest quarter net profit of ₹32 Cr exceeds sales of ₹17 Cr, suggesting non-operating or one-off income
• P/B of 16.46 against book value of ₹3,296.08 leaves no asset-based margin of safety
• ROCE of 9.39% is far below ROE of 20.70%, indicating core trading returns are weak
• 231% profit growth and PEG of 0.07 look unsustainable against only 10.68% sales growth

AI Analysis

At ₹54,250, Yamuna Syndicate looks cheap at 8.26 times trailing earnings. But as Graham taught, the P/E is only a starting point, not a conclusion. This is a trading and distribution business, yet the latest quarter reported net profit of ₹32 Cr against sales of just ₹17 Cr. Profits higher than sales do not come from day-to-day operations; they come from something transient. That is a warning. The balance sheet seems sound: Debt/Equity is N/A, Piotroski F-Score is 7/9, and book value is ₹3,296.08 per share. ROE of 20.70% is pleasing, but ROCE of only 9.39% tells me the core capital employed is not earning that return. The gap points to non-operating income, and non-operating income is not a moat. The stock has also run from ₹24,800 to ₹54,250 in 52 weeks, so the market has already celebrated this profit spike. At 16.46 times book value, there is no asset cushion; I am paying for a prosperous income statement. A low P/E and a 0.07 PEG look attractive only if the 231% profit growth continues. But sales growth is only 10.68%, and no distribution franchise can compound profits at 231% without revenue growing much faster. Dividend yield of 1.69% is modest. My conclusion: this resembles a cyclical or event-driven peak, not a sustainable compounder. I need to see several quarters of honest, operating, repeatable profits before I call it a bargain. Until then, the low P/E may simply be a value trap dressed in a good quarterly number.

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