Rachit Prints (544503)

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

Key Financials

Strengths

• ROCE of 38.57% indicates highly efficient use of capital employed
• Sales growth of 27% shows healthy demand and business expansion
• P/E of 11.78 and PEG of 0.62 suggest a reasonable valuation relative to growth
• Piotroski F-Score of 7/9 points to overall decent financial health

Concerns

• Profit growth of 11.21% lags sales growth of 27%, implying margin pressure
• No dividend means shareholders depend entirely on reinvestment quality and capital allocation
• Missing balance sheet data such as debt/equity, book value, and promoter holding makes financial risk unassessable
• Textile industry is cyclical and competitive, with limited durable competitive advantage

AI Analysis

At 11.78 times earnings, the market is not paying up for Rachit Prints. A 38.57% return on capital employed is eye-catching, especially in a textile business, and the 27% sales growth suggests demand is healthy. The Piotroski F-Score of 7 out of 9 tells me the company is not in obvious financial distress; profitability, leverage and efficiency indicators are mostly favourable. The PEG of 0.62 makes the valuation look attractive only if the growth trajectory is durable. But I must pause. Profit growth is 11.21%, far slower than sales growth. That means the extra revenue is not converting to profits at the same rate; margins are being squeezed. Textiles have never been a business with a wide moat; capital flows easily into them, competition is brutal, and demand can be cyclical. I think back to Berkshire’s own textile history, and that memory keeps me humble. I also lack critical facts: no book value, no debt-to-equity ratio, no promoter holding, no 52-week range. Graham would never buy a stock without a balance sheet anchor. The latest quarter shows ₹26 crore in sales and ₹2 crore in net profit, a 7.7% margin that could be volatile. There is no dividend, so every rupee of value must be created through reinvestment, yet I have no evidence of management’s track record or ownership. This is not a business I can value with confidence. It could be a nice little compounder, or it could be a cyclical textile company at a good moment. At the current price, there is some margin of safety, but not enough information to sleep well. I would put this on a watchlist and demand several more quarters of data before making a decision.

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