Asahi India Glas (ASAHIINDIA)

FairStock Score: 49/100 — MIXED

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

Key Financials

Strengths

• Promoter holding of 51.58% aligns interests and provides stability.
• Piotroski F-Score of 8/9 indicates solid financial fundamentals; Altman Z-Score of 3.53 suggests low bankruptcy risk.
• Five-year revenue CAGR of 13.67% shows a proven growth track record; latest quarter remained profitable at ₹99 Cr net profit on ₹1,256 Cr sales.
• ROCE of 12.45% and ROE of 11.41% are reasonable, with debt/equity of 0.77 still manageable.

Concerns

• P/E of 73.22 and P/B of 8.16 are far too rich for ROE of 11.41% and a 13.65% profit decline.
• Free cash flow is deeply negative at ₹-471 Cr; reported profits are not converting into cash.
• EV/EBITDA of 254.22 signals an extreme valuation; Graham Number of ₹171.80 versus price of ₹854.20 implies a -424.26% margin of safety.
• Dividend yield of 0.22% is negligible, and sales growth has slowed to 6.55% from the 5-year CAGR of 13.67%.

AI Analysis

Let me start with the numbers that matter. Asahi India Glas sells at ₹854.20, which gives a market cap of ₹22,961 crore against book value of only ₹104.70 per share — a P/B of 8.16. The P/E of 73.22 would demand exceptional growth, but profit fell 13.65% while sales grew just 6.55%. The latest quarter does show a net profit of ₹99 crore on sales of ₹1,256 crore, so it is not a broken business, but the trajectory is hardly one that justifies such a premium. The business has some decent qualities. Promoters own 51.58%, aligning interests. ROCE of 12.45% and ROE of 11.41% are respectable but not wonderful. The Piotroski score of 8/9 suggests the balance sheet is technically healthy, and Altman Z of 3.53 implies low bankruptcy risk. Yet the company burned ₹471 crore in free cash flow, and EV/EBITDA stands at 254.22 — that is an extraordinary multiple for any business, let alone an auto-component maker facing cyclical demand. Ben Graham would ask: is there a margin of safety? The Graham Number is ₹171.80, while the stock trades 424% above that level. The dividend yield of 0.22% gives shareholders almost nothing while they wait. For a business growing revenue at 13.67% over five years but with current sales growth of only 6.55% and declining profits, the market is paying for perfection. I cannot pay 73 times earnings for a company whose earnings are going backwards and whose cash generation is negative. In an auto glass business, tied to vehicle sales and discretionary replacement demand, there is no moat strong enough to validate this price. I would keep this on my watchlist, not in my portfolio.

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