Sayaji (Indore) (544080)

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

Key Financials

Strengths

• Strong capital efficiency: ROE 22.93% and ROCE 18.91%
• Profit growth of 29.30% with a reasonable PEG of 1.26 if growth persists
• Latest quarter profitable with ₹32 Cr sales and ₹6 Cr net profit
• Piotroski F-Score of 7/9 indicates generally sound fundamentals

Concerns

• Sales growth of only 6.50% versus profit growth of 29.30% suggests reliance on margin expansion, not sustainable top-line growth
• Valuation is rich: P/E 22.62 and P/B 5.55 leave little margin of safety
• Dividend yield of 0.09% means almost zero cash return to shareholders
• Debt/Equity and promoter holding are undisclosed, so leverage and governance cannot be properly assessed

AI Analysis

Looking at Sayaji (Indore), I see a respectable hotel business with an excellent return profile: ROE at 22.93% and ROCE at 18.91% show that management has historically put capital to work well. The Piotroski score of 7/9 also tells me the financial position is not damaged. But my discipline demands a margin of safety, and at ₹1,132 with a P/E of 22.62 and P/B of 5.55, the market is paying a full price for this quality. Since book value is ₹203.79, I am paying ₹5.55 for every ₹1 of net worth. The latest quarter shows ₹32 Cr sales and ₹6 Cr profit—roughly 18.75% net margin—so the business is earning well today. Yet I am bothered by the divergence: sales grew only 6.50%, while profit grew 29.30%. In a capital-intensive hotel cycle, those figures often come from tariffs and occupancy peaking, not from durable unit growth. A 0.09% dividend yield means I receive almost no cash while waiting. Debt/equity and promoter holding are not disclosed here—unacceptable if I am expected to invest a large sum. The 52-week range of ₹702 to ₹1,226 tells me the stock has already been re-rated. I would not label this a franchise; it is a cyclical with strong current numbers. If the upcycle fades, the high multiple amplifies the downside. For Mr. Graham, the price is not yet an invitation. I would wait for either a lower price or evidence that top-line growth can catch up with profit growth before committing.

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