Kranti Industrie (542459)

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

Key Financials

Strengths

• Revenue growth of 37.27% shows strong sales momentum.
• Profit growth of 132.04% is sharp, and PEG of 0.41 suggests the growth rate offsets the headline P/E.
• Piotroski F-Score of 6/9 indicates reasonably healthy fundamentals on several financial metrics.
• Book value of ₹26.25 provides some asset backing against the ₹68.08 price.

Concerns

• Latest quarter net profit is effectively ₹0 on ₹25 crore sales, raising serious doubt about earnings quality and margin sustainability.
• Negative ROCE of -0.56% means the company is not earning its cost of capital.
• ROE of 8.28% is mediocre, and there is no dividend yield for shareholders.
• Valuation is rich at P/E of 34.83 and P/B of 2.59, with promoter holding and debt-equity ratio undisclosed.

AI Analysis

Let me start with what I can measure. Kranti Industrie has a market cap of only ₹78 crore, so this is a microcap in the auto components space. Sales grew 37.27% and reported profit grew 132.04%, which looks exciting. But when I look at quality, I pause. Return on equity is just 8.28%, meaning the company earns less than what a decent business should deliver; I prefer businesses with consistent ROE well above 15. The negative ROCE of -0.56% is a red flag: it suggests operations are not yet earning their cost of capital. And the latest quarter shows net profit of nearly ₹0 on ₹25 crore of sales. That is an extremely thin — effectively zero — margin. A company can show strong year-on-year growth from a low base and still fail the Graham test of durable earning power. The balance sheet gives some book value support at ₹26.25, but at ₹68.08 the share trades at 2.59 times book value. With a P/E of 34.83, the market is paying a premium. The PEG of 0.41 looks cheap only if the 132% profit growth continues; that is a big 'if' when the current quarter produces no meaningful profit. There is no dividend, so my return depends entirely on capital appreciation. Promoter holding and debt-equity figures are not available, and I refuse to invest without knowing who controls the company and how leveraged it is. Price is what you pay; value is what you get. Here, the evidence is incomplete. This could be a fast grower, but it is not yet a proven compounding machine. I would wait for real operating profitability and capital discipline before putting my money to work.

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