Ceigall India (CEIGALL)

FairStock Score: 41/100 — MIXED

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

Key Financials

Strengths

• Sales growth of 19.34% with latest quarterly revenue of ₹991 Cr indicates strong execution demand
• Return ratios are healthy: ROE 15.39% and ROCE 19.38%
• Piotroski F-Score of 7/9 suggests sound fundamentals and limited accounting red flags
• Promoter holding of 82.06% ensures strong owner alignment
• Debt-to-equity of 0.69 is moderate for a capital-intensive construction business

Concerns

• Profit growth of only 1.24% versus 19.34% sales growth points to significant margin compression
• Valuation is not cheap: P/E of 19.07 and P/B of 3.48 versus book value of ₹93.52
• Dividend yield is 0.00%, so minority shareholders get no income while waiting
• Civil construction is cyclical and subject to order flow, input costs, and government capex visibility

AI Analysis

When I look at Ceigall India, I see a decent business trapped in a demanding price. Sales grew 19.34%, and latest quarter sales of ₹991 Cr show an active civil construction franchise. Returns are respectable: ROE 15.39%, ROCE 19.38%, and debt-to-equity of 0.69 is manageable. The Piotroski score of 7/9 also tells me the balance sheet is not deteriorating. Promoter holding at 82.06% is a positive sign; owners are firmly alongside minority shareholders. But Graham taught me to weigh the arithmetic. Net profit growth is only 1.24% despite 19.34% revenue growth. That is a red flag. The company is earning more but keeping very little extra—margins are under pressure. At ₹325.50, the market cap is ₹4,946 Cr, over 3.48 times book value of ₹93.52. For a cyclical construction business, I want a margin of safety, not a premium. A P/E of 19.07 may be tolerable for a consumer franchise; it is not for a contractor dependent on government capex cycles. With zero dividend yield, the shareholder is asked to wait for capital appreciation alone. Meanwhile, FairStock Score of 36/100 is mixed, and my own reading agrees. This is not a terrible business. It has scale, growth, and a strong promoter. But I am in the business of preserving capital. At this price, the margin of safety is thin. I would need to see profit growth catch up with sales, better conversion to cash, and evidence the order book is durable before paying ₹325 for a construction stock.

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