Promax Power (543375)

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

Key Financials

Strengths

• Sales growth of 23.78% shows solid demand traction.
• Piotroski F-Score of 7/9 suggests reasonably sound accounting and improving fundamentals.
• ROCE of 11.02% is acceptable for a capital-intensive civil construction business.
• Latest quarter is profitable with ₹36 Cr sales and ₹1 Cr net profit, though margins are thin.

Concerns

• Net margin is only ~2.8% (₹1 Cr profit on ₹36 Cr sales) and profit growth of 7.09% badly trails sales growth of 23.78%.
• P/E of 17.80 with zero dividend offers little margin of safety; earnings-based PEG is closer to 2.5 despite the reported 1.15.
• Missing data on promoter holding, book value, debt/equity and ROE makes fundamental assessment incomplete.
• Civil construction is cyclical and highly competitive, so order flows and margins can weaken quickly.

AI Analysis

At ₹48.66, Mr Market has already marked Promax Power up to the top of its 52-week range, and my first reaction is caution. A civil construction company earning ₹1 crore on ₹36 crore of quarterly sales has a net margin of only about 2.8%. Sales rose 23.78%, but profit rose just 7.09%. When revenue outpaces profit by that much, it often means the business is buying growth at the expense of pricing power and efficiency. I also cannot perform a Graham-style margin-of-safety check because book value, debt-equity, promoter holding and return on equity are not disclosed. Insufficient data is itself a risk. The reported ROCE is 11.02% — decent, but not the sign of a fortress. The Piotroski score of 7/9 is encouraging, and the topline growth shows demand, but this is still an intensely competitive, cyclical industry with lumpy order flows and no durable moat. At a P/E of 17.80, Mr Market is paying a growth multiple for a low-margin construction stock. The listed PEG of 1.15 looks flattering because it seems to rest on sales growth; using the actual profit growth of 7.09%, the earnings-based PEG is closer to 2.5. That is not the bargain I look for. With zero dividend, shareholders depend entirely on further price appreciation. I would classify this as a cyclical, not a stalwart. If management can convert its order book into profit and improve margins, there may be a good business underneath. But at this price, I would prefer to wait — or pass.

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