Alankit (ALANKIT)

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

Key Financials

Strengths

• Trading at 0.80 times book value (₹11.46) provides balance-sheet support.
• Very low debt/equity of 0.07 leaves room to survive downturns.
• Profit after tax grew 46.95% and Piotroski F-Score of 6/9 points to improving operations.
• Promoters own 54.15%, aligning interests with minority shareholders.
• P/E of 9.84 and PEG of 0.21 indicate reasonable valuation if earnings growth persists.

Concerns

• ROE of 3.82% is poor; the business earns little on shareholder capital.
• Sales declined 1.47% despite a 46.95% profit jump, raising durability concerns.
• No dividend yield (0%), so investors receive no income while waiting.
• No clear economic moat in diversified commercial services; competition can erode margins.

AI Analysis

At ₹9.15, Alankit offers a classic Graham setup — a share trading below its book value of ₹11.46, with a price-to-book of 0.80. That gives me a margin of safety on the balance sheet, but a margin of safety doesn't make a good investment by itself. The business must earn a decent return on that book value. Here I am disappointed: ROE is only 3.82%. For every ₹100 of equity, the company earns less than ₹4. ROCE of 11.29% is more acceptable, but it is not a moat. A truly wonderful company would have dominant pricing power and high, stable returns; Alankit is in diversified commercial services, a field where competition is intense and pricing power is limited. The balance sheet is conservative — debt-to-equity of 0.07 — so the company is not going to sink under leverage. Profit growth of 46.95% looks exciting, but I must ask why sales fell 1.47% at the same time. Rising profit on falling sales often comes from cost cuts, not underlying strength. The latest quarter net profit of ₹8 Cr on revenue of ₹72 Cr is a sharp margin, but I would want to see if that margin is sustainable. The market is not paying much: P/E of 9.84 and PEG of 0.21 imply the Street expects continued growth. However, with a 0% dividend yield, the retail investor is asked to wait patiently for capital gains with no cash compensation. Promoter holding of 54.15% is good; interests are aligned. The Piotroski score of 6/9 is decent, not excellent. This is more a turnaround candidate than a durable compounder. If earnings quality persists and revenue turns positive, the stock is cheap; if not, the discount to book may widen.

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