Algoquant Fin (ALGOQUANT)

FairStock Score: 43/100 — MIXED

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

Key Financials

Strengths

• Exceptional return ratios: ROE 38.23% and ROCE 32.78%
• Low leverage with Debt/Equity of 0.24
• High promoter holding of 73.68% aligns minority interests
• Piotroski F-Score of 7/9 indicates solid recent financial health
• Huge reported profit growth of 439.64%, but needs caution

Concerns

• Extremely rich valuation: P/E 94.25 and P/B 32.57 versus book value of only ₹1.69
• Sales growth of just 5.16% versus profit growth of 439.64% suggests a margin-driven spike that may not be durable
• No dividend yield; investor returns depend entirely on price appreciation
• Latest quarter annualises to only ~₹24 Cr profit against a ₹1,691 Cr market cap, leaving little room for error

AI Analysis

At first glance, Algoquant Fin looks like a profit machine: ROE 38.23%, ROCE 32.78%, and debt-equity only 0.24. A 73.68% promoter holding also signals skin in the game. But Graham taught me to judge a business by the price I pay. At ₹55.05, the market cap is ₹1,691 Cr. The P/E is 94.25 and the P/B is 32.57 against a book value of just ₹1.69. That is a very rich price for a financial-services company whose latest quarter delivered only ₹52 Cr sales and ₹6 Cr profit—about ₹24 Cr annualised against a ₹1,691 Cr market cap. The bigger red flag is the gap between sales growth and profit growth. Sales grew only 5.16%, while profit exploded 439.64%. That kind of divergence usually comes from margin expansion, cost cuts, or a low base, not from a durable moat. It is not the same as 439% growth in customer demand or revenue. The Piotroski score of 7/9 tells me recent financial health is good, but it is a rearview mirror. The PEG of 0.42 is seductive only if you use this one-year profit spike as the future growth rate; the modest sales growth undermines that assumption. There is no dividend yield, and FairStock Score is a mixed 43/100. With zero dividend and a P/B of 32.57, the market has already priced in many years of success. In Buffett's words, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.' Here I'm not sure the business is wonderful—the revenue numbers are too flat—and the price is definitely not fair. I would wait for revenue growth to match the profit recovery, or for a substantially lower price. This is a possible turnaround in profitability, not a margin of safety at today's valuation.

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