Agro Phos India (AGROPHOS)

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

Key Financials

Strengths

• Trading below book value: P/B 0.96 at ₹33.15 versus book value ₹34.62
• Low P/E of 7.29 and dividend yield of 2.92% provide some income support
• Sales growth of 57.12% shows topline momentum
• Healthy leverage: Debt/Equity only 0.37 and ROCE 14.37%
• Promoter holding of 54.27% aligns owner-management interests

Concerns

• Profit growth down 71.49% despite 57.12% sales growth, indicating severe margin compression
• Latest quarter net profit only ₹1 Cr on ₹36 Cr sales, implying a thin ~2.8% margin
• Piotroski F-Score of 4/9 suggests deteriorating financial health
• Commodity fertilizer business lacks pricing power and is highly cyclical

AI Analysis

At ₹33.15, Agro Phos India sells at 0.96 times book value of ₹34.62 and just 7.29 times earnings. That looks like the kind of cigar-butt Graham might bend down for. But I have to ask: is this a good business, or just a cheap one? Fertilizers are commodity products; I see no durable moat. The numbers scream cyclical stress. Sales grew 57.12%, yet profits collapsed 71.49%. Latest quarter: ₹36 Cr sales, only ₹1 Cr net profit. That is a razor-thin 2.8% margin. In this business, a good year can quickly turn into a bad one. The balance sheet is workable: debt/equity 0.37 and ROCE 14.37% are respectable. The 2.92% dividend while waiting is a comfort, and promoter holding at 54.27% aligns interest. But the Piotroski F-score of 4/9 warns of deteriorating financial health. I cannot call this a franchise. It is a cyclical, and Mr. Market has marked it down for good reason. If I buy, I need a margin of safety and a willingness to watch quarterly subsidy or input-cost swings. The low P/E and below-book price provide some cushion, but cheap can become cheaper when earnings keep falling. I'd wait for evidence that margins are stabilizing and profit growth turns positive before deploying capital. This is not a wonderful company; at best it's a possible asset play within a cyclical trough.

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