Silicon Rental (543615)

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

Key Financials

Strengths

• Trailing P/E of 7.82 and market cap of ₹185 Cr make the stock look inexpensive if earnings stabilise.
• ROCE of 20.62% suggests decent capital efficiency despite the small size.
• Sales grew 12.3%, and the latest quarter shows ₹62 Cr revenue, indicating demand is still expanding.
• Dividend yield of 1.39% offers a small income cushion while waiting for a turnaround.

Concerns

• Profit growth fell 37.1%, and the latest quarter's net margin is only about 8%, showing significant margin compression.
• Piotroski F-score of 4/9 points to weak financial health and deteriorating fundamentals.
• Missing data on book value, debt-to-equity, and promoter holding prevents a proper Graham-style balance sheet assessment.
• The wide 52-week range of ₹57 to ₹229 highlights high volatility and cyclicality.

AI Analysis

At ₹177, Silicon Rental is a small-cap that catches my eye only because the price looks cheap. A P/E of 7.82 against a market cap of ₹185 Cr is low, and a 12.3% sales growth with 20.62% ROCE suggests the underlying business is not dead. But Graham taught me to look past the headline multiple. Profit growth is down 37.1%, and the latest quarter shows ₹62 Cr in sales but only ₹5 Cr in net profit, a net margin near 8%. That tells me competition or cost pressures are squeezing the business even as revenue expands. The Piotroski F-score of 4 out of 9 reinforces my caution: on this scoreboard, the business is financially weak, not improving. The advertised PEG of 0.64 is meaningless when the growth figure is negative on actual trailing earnings; a cheap stock can become cheaper if profits keep falling. I cannot calculate book value, return on equity, or debt-to-equity because the data is missing. That is unacceptable for a margin-of-safety investor. I would need to inspect the balance sheet and cash flow statements before trusting this valuation. The 52-week range of ₹57 to ₹229 also tells me this is a volatile, cyclical small-cap, not a steady compounder. ROCE of 20.62% and a dividend yield of 1.39% are the bright spots, but they do not outweigh the earnings decline and lack of disclosure. I would put this in the too-hard pile unless quarterly profits stabilise, margins recover, and the balance sheet is proven clean. Price alone is not value; value is the relationship between price and the cash the business can generate over time. Right now, the cash generation is heading the wrong way.

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