Allied Digital (ADSL)
TurnaroundFairStock Score: 36/100 — MIXED
Score breakdown: P/E: 2/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹112.82 |
| Market Cap | ₹639.07 Cr |
| P/E Ratio | 18.05 |
| ROCE | 10.87% |
| ROE | 2.89% |
| Dividend Yield | 1.33% |
| Profit Growth | -4.8% |
| Debt/Equity | 0.2 |
| Sales Growth | 18.9% |
| Promoter Holding | 51.07% |
| 52-Week Range | ₹86.27 — ₹209.53 |
| Sector | IT - Services |
| Book Value | ₹108.28 |
Strengths
- Low debt-to-equity of 0.18 provides a solid balance sheet cushion
- Promoter holding of 51.07% aligns management incentives with minority shareholders
- Sales grew 12.17%, showing some demand traction in the business
- Book value of ₹83.84 and P/B of 1.41 offer a moderate asset backing
- Nominal dividend yield of 1.27% gives minor downside comfort
Concerns
- ROE of only 2.89% indicates poor returns on shareholder equity
- Profit declined 18.18% despite revenue growth, signaling weak operating leverage
- Piotroski F-score of 4/9 and FairStock Score of 29/100 point to financial fragility
- P/E of 18.13 is not cheap for a company with declining earnings
AI Analysis
Let's begin with the obvious: Allied Digital is not a wonderful business at first glance. A promoter holding of 51.07% is comforting, and a debt/equity of 0.18 shows they are not gambling with borrowed money. But the key metric for any equity is return on equity, and 2.89% is poor. We are not earning much on the capital invested. ROCE of 10.87% is better but still nothing to excite a long-term owner. The company has grown sales by 12.17%, yet profit has fallen 18.18%. That is exactly the sort of divergence I distrust: revenue without earnings is not value creation. With latest quarter sales of ₹247 Cr and net profit of ₹14 Cr, the margin is thin. The Piotroski F-score of 4/9 and FairStock Score of 29/100 also reinforce caution. Valuation? A P/E of 18.13 for a business with declining profits is not cheap. A P/B of 1.41 against book value of ₹83.84 is modest, but a low book multiple is a trap if ROE is as low as this. At ₹117.91, down from its 52-week high of ₹209.53, it looks like a falling knife. The dividend yield of 1.27% gives a little comfort, but a falling stock can always go lower. I need signs that operations are stabilizing: profit growth turning positive, ROE climbing, and the F-score improving. Until then, this belongs in the too-hard pile. In Graham's words, price is what you pay, value is what you get. Here, I am not convinced the quality matches the price. It could be a turnaround, but I need evidence before acting.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer