Arihant Super. (ARIHANTSUP)

FairStock Score: 21/100 — RISKY

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

Key Financials

Strengths

• Promoter holding is 71.10%, so promoters have significant skin in the game and are directly aligned with minority shareholders.
• Latest quarter is still profitable: ₹126 crore sales and ₹8 crore net profit, showing ongoing project execution.
• ROCE of 11.10% indicates the operating business earns a positive return on capital employed even before debt costs, giving some room for recovery if the cycle improves.
• The stock is 42% below its 52-week high of ₹465, so some earlier over-optimism has already been taken out of the price.

Concerns

• ROE is only 0.70%, but price/book is 5.54; investors are paying a huge premium for very low equity returns.
• Sales growth is -16.40% and profit growth is -67.50%; the business is shrinking at both top and bottom lines.
• Debt/equity of 1.98 is heavy for real estate; any project delay could create liquidity and cost pressure.
• Piotroski F-Score of 3/9 signals poor financial health and possible further deterioration in margins or balance-sheet quality.

AI Analysis

Let me start with the basics. Arihant Super is a residential and commercial developer, currently at ₹267.85 with a market cap of ₹1,146 crore. I see a P/E of 25.23 on profits that fell 67.50% last year; sales fell 16.40%. That is not a growth stock and not a value stock based on trailing numbers. Book value is ₹48.32, so the market is paying 5.54 times book for a business earning only 0.70% ROE. That premium makes no sense to me unless earnings recover strongly and quickly. ROCE of 11.10% tells me the underlying projects can generate some return, but debt/equity of 1.98 means much of that return is built on borrowed money. In real estate, the cycle can turn faster than management can repay debt. The Piotroski F-score of 3/9 points to weakening fundamentals and rising financial stress. The latest quarter has ₹126 crore revenue and ₹8 crore net profit, so the company is not dead, but the margin is thin. Promoter holding of 71.10% is a positive; the owners are still in the boat. Dividend yield of 0.57% is merely symbolic. The stock has already fallen from ₹465 to ₹267.85, but a fallen price does not itself create a margin of safety. I need to see evidence of stabilised sales, lower leverage, and a ROE moving toward double digits. Until then, I would categorise this as a cyclical business heading through a tough phase, not a compounding machine. It belongs to the 'too hard' pile.

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