Bajaj Consumer (BAJAJCON)

FairStock Score: 47/100 — MIXED

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

Key Financials

Strengths

• Exceptional capital efficiency: ROE 22.06% and ROCE 19.06% with near-zero debt
• High reported sales growth of 30.58% and profit growth of 83.21%
• Piotroski F-Score of 7/9 indicates solid recent financial health
• Reasonable latest-quarter profitability: ₹46 Cr net profit on ₹306 Cr sales
• Promoter holding of 42.97% aligns interests with minority shareholders

Concerns

• Rich valuation: P/E 32.75 and P/B 8.27 leave little room for error
• Zero dividend yield offers no cash support to shareholders
• Profit growth of 83.21% may be unsustainable or non-recurring; sales growth is much lower
• Stock has fallen sharply from ₹691.15 to ₹464.50, raising questions about momentum or competitive pressure

AI Analysis

Let me start with a simple question: can I understand Bajaj Consumer? Yes—it sells branded personal-care products, and the economics look good on the surface. Return on equity is 22.06%, ROCE is 19.06%, and debt-to-equity is just 0.02. That is a clean balance sheet and an efficient business. A Piotroski score of 7 out of 9 also tells me recent fundamentals are decent. The growth rates jump off the page: sales up 30.58% and profits up 83.21%. But as Graham would say, one year of profit growth is not proof of durable growth. The latest quarter, with ₹306 Cr sales and ₹46 Cr profit, gives a healthy margin, but the P/E of 32.75 and P/B of 8.27 mean I am paying a rich price. At ₹464.50, the stock trades well below its 52-week high of ₹691.15. That could reflect a better entry point or a deteriorating outlook; I cannot assume it is cheap just because it fell. A zero dividend yield also bothers me: I get no cash return while waiting for the story to play out. The reported free cash flow of ₹136.45 lakh Cr fails a basic sanity check next to a ₹5,161 Cr market cap, so I give that figure no weight. The PEG of 0.58 looks attractive, but only if the 30%+ sales growth genuinely persists. FairStock's 47/100 mixed score matches my own caution. This is an impressive fast grower with a strong franchise and low leverage, but I need a margin of safety, and at nearly 33 times earnings, the market is asking for near-perfect execution. I would wait for a lower price or clearer proof that growth is sustainable before acting.

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