Dr Agarwal's Hea (AGARWALEYE)

FairStock Score: 38/100 — MIXED

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

Key Financials

Strengths

• Revenue CAGR of 29.43% over 5 years shows strong business expansion
• Sales growth of 23.02% and profit growth of 51.03% indicate accelerating momentum
• Piotroski F-Score of 7/9 suggests solid financial health and operational efficiency
• Debt/Equity of 0.51 is moderate and not excessive for a capital-intensive hospital business

Concerns

• P/E of 112.29 and P/B of 7.46 leave no margin of safety for a value investor
• Free cash flow is negative at ₹-390 Cr, meaning earnings are not translating into cash
• Promoter holding at 32.39% is low for a founder-led healthcare business
• No dividend and PEG of 3.03 mean investors are entirely dependent on continued high growth to justify the price

AI Analysis

When I look at Dr Agarwal's Hea, I see a fast-growing hospital business that has compounded revenues at nearly 29% annually over five years. That is impressive. Sales grew 23% and profits jumped 51%, so the operating engine is clearly moving. Piotroski's F-Score of 7 also suggests healthy fundamentals. But as Graham would remind me, price is what you pay. At ₹460 with a P/E of 112 and a P/B of 7.46, the market is paying a heavy premium for this growth. A PEG of 3.03 tells me the growth is already more than priced in. The most serious red flag is free cash flow of negative ₹390 crore. Growing earnings are wonderful, but a business that cannot convert profits into cash needs constant financing. Debt-to-equity of 0.51 is manageable, but with negative cash flow, leverage can become a trap. Promoter holding of only 32.39% is another concern; I like owners who eat their own cooking. ROCE of about 10% is decent but not exceptional, and with ROE not available, I cannot verify the return on shareholder equity. There is no dividend, so the only return is capital appreciation, which depends entirely on the story continuing. This is a promising enterprise, but at this valuation, I would demand a wide margin of safety. I prefer buying great growth at a sensible price, and this is not that day.

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