Bharat Rasayan (BHARATRAS)

FairStock Score: 16/100 — RISKY

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

Key Financials

Strengths

• Very low leverage with Debt/Equity of 0.08
• Piotroski F-Score of 7/9 indicates decent financial health
• Promoter holding of 74.99% aligns interests
• Profit growth of 10.74% outpacing sales growth of 5.48% suggests improving margins
• Latest quarter sales of ₹270 Cr and net profit of ₹34 Cr show current operating profitability

Concerns

• FairStock Score of 28/100 flags the stock as risky
• P/E of 17.69 and PEG of 2.18 offer limited margin of safety
• Dividend yield of 0.02% gives almost no income support
• ROE of 11.95% and ROCE of 14.33% are modest, with no clear moat in a competitive agrochemical industry

AI Analysis

At first glance, I see a clean balance sheet: debt/equity of 0.08 and a Piotroski F-Score of 7/9. The promoter holding of 74.99% also keeps my interests aligned with management. But I am in the business of buying a wonderful company at a fair price, not just any company with low debt. Bharat Rasayan is a pesticides and agrochemicals player, and the 52-week range—₹1,203 to ₹2,987.50—reminds me that this is a cyclical, volatile business, not a predictable compounder. Sales grew only 5.48%, while profit grew 10.74%—that is acceptable, but not spectacular. At ₹1,439.10, I am paying 17.69 times earnings and twice book value. For a business with ROE of 11.95% and ROCE of 14.33%, that gives me no significant margin of safety. The PEG of 2.18 tells me the market is already paying for the growth on offer. The latest quarter had sales of ₹270 Cr and net profit of ₹34 Cr; a decent quarter, but one quarter cannot prove durability in a price-competitive agri-input industry. The FairStock Score of 28/100 is a flashing warning, and a dividend yield of 0.02% means I receive almost no income while I wait. If this is a cyclical peak, the current earnings could regress; if it is a trough, I still need proof that the cycle is turning. I would want a significantly lower price, or a much stronger margin trend, before committing capital. For now, this looks like an average business with a reasonable but not compelling valuation. In the classic sense, I will let it pass and keep looking for simpler, higher-quality opportunities.

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