Aditya Ultra (AUSL)

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

Key Financials

Strengths

• Promoter holding is high at 68.76%, indicating strong insider alignment with minority shareholders.
• ROCE of 13.38% shows the capital base is still generating a respectable return despite the downturn.
• Latest quarter is still profitable: ₹1 crore net profit on ₹184 crore sales, avoiding a loss.
• Optical P/E of 12.84 is not excessive if earnings stabilize, though earnings quality is weak.

Concerns

• Sales have fallen by 40.95% and profits by 88.27%, indicating a severe cyclical earnings collapse.
• Piotroski F-Score of 3/9 points to weak financial health and deteriorating operating fundamentals.
• Latest quarter net margin is razor-thin at roughly 0.54%, reflecting negligible pricing power.
• No dividend and no disclosed book value or debt/equity data make it impossible to assess a proper margin of safety.

AI Analysis

Aditya Ultra is exactly the kind of commodity steel business I approach with wariness. The figures tell me this is a cyclical operation, not a franchise with enduring moat. Sales have collapsed by nearly 41% and profits by 88%, leaving only ₹1 crore of net profit on ₹184 crore of quarterly sales. That is a microscopic margin, and it shows the company has little pricing power when the steel cycle turns down. At ₹23.10, the P/E of 12.84 may appear reasonable, but conventional earnings multiples are treacherous when earnings are falling; a cyclical with declining profits can look statistically cheap for years. The Piotroski F-Score of 3/9 reinforces my concern about financial health and operational quality. On the positive side, promoter holding is high at 68.76%, which means owners have skin in the game, and ROCE is 13.38%, suggesting the capital base is still generating some return. However, with no dividend and no book value or debt/equity data disclosed, I cannot compute a proper margin of safety. Graham taught me to demand both quantitative and qualitative evidence. This business lacks a durable competitive advantage, is subject to volatile commodity prices, and has suffered a severe earnings contraction. A bargain hunter might be tempted by the low market cap of ₹61 crore, but I would need much stronger balance-sheet data and evidence that the downturn is ending before acting. For now, I classify this as a cyclical, not a stalwart or a franchise.

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