Chandan Healthca (CHANDAN)

FairStock Score: 58/100 — STEADY

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

Key Financials

Strengths

• ROCE of 28.85% indicates strong capital efficiency
• Profit growth of 44.52% is outpacing sales growth of 18.98%, showing operating leverage
• Piotroski F-Score of 7/9 points to solid financial health
• Promoter holding of 49.55% aligns management interests with shareholders
• PEG of 0.69 suggests reasonable valuation relative to recent growth

Concerns

• Zero dividend yield means no cash return to shareholders
• Book value, ROE, and debt/equity are not disclosed, limiting margin-of-safety analysis
• Latest quarterly net margin is only about 7.7% (₹5 Cr profit on ₹65 Cr sales)
• A P/E of 21.93 could look expensive if profit growth decelerates sharply

AI Analysis

Looking at Chandan Healthca, I first ask what I get for ₹254.30. The company earns roughly ₹29 Cr on a ₹636 Cr market cap, so a P/E of about 21.93. That is not a Benjamin Graham bargain, but quality can justify price. ROCE of 28.85% is excellent; it tells me management earns good returns on capital employed. Sales grew 18.98% and profit grew 44.52%, so profit is outpacing revenue -- an encouraging sign of operating leverage. The Piotroski F-Score of 7 out of 9 also suggests a financially sound business, not a distressed one. Promoters own 49.55%, which keeps their interests aligned with ordinary shareholders. In a healthcare service provider, that stability matters. However, I have reservations. The dividend yield is zero; I am being asked to rely entirely on growth and reinvestment. Book value, ROE, and debt/equity are not disclosed here, so I cannot fully assess the cushion of net assets or leverage. That bothers a follower of Graham. Quarterly net profit is ₹5 Cr on sales of ₹65 Cr, a margin of roughly 7.7%; this is not a high-margin franchise. A PEG ratio of 0.69 is attractive only if the 44.52% profit growth continues, and that pace is unlikely to compound forever. At 21.93 times earnings, if growth slows to even 20%, the price no longer looks cheap. This is an interesting fast grower, but I would demand consistent proof that capital allocation remains this good before committing a large sum.

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