Dharmaj Crop (DHARMAJ)

FairStock Score: 27/100 — RISKY

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

Key Financials

Strengths

• Low debt/equity of 0.31 provides balance-sheet cushion
• Promoter holding of 70.40% aligns owner interests
• Sales growth of 8.61% shows business is still expanding
• ROE and ROCE around 12% indicate acceptable capital efficiency

Concerns

• Profit growth fell 34.75%, and latest quarter net profit was only ₹1 crore on ₹190 crore sales
• Piotroski F-Score of 4/9 suggests weak financial health
• Zero dividend yield means no income while waiting for recovery
• PEG of 1.93 is not attractive when earnings are declining

AI Analysis

At ₹266, Dharmaj Crop has a ₹800 crore market cap, and I am asked to judge it the way I would any business. A P/E of 16.58 and P/B of 2.27 are not demanding, but cheapness must be earned by durable earnings. Here the earnings are not cooperating. Sales grew 8.61%, yet profit fell 34.75%, and the latest quarter delivered only ₹1 crore net profit on ₹190 crore sales. That is a razor-thin margin and a clear sign of pricing pressure, probably in a cyclical agrochemical market. A Piotroski score of 4/9 reinforces the suspicion of deteriorating fundamentals, not a solid balance sheet. To be fair, debt/equity is only 0.31, and promoter holding is 70.40%, which tells me owners are still heavily invested. ROE and ROCE near 12% are acceptable, but not spectacular; commodities businesses need higher returns or a moat to deserve my money. I see no moat from these numbers. The dividend yield is zero, so I am not being paid to wait. With PEG of 1.93 and falling profit, the market is still pricing in growth that must be proven. This looks like a cyclical business in a down part of its season, not a durable compounder. I would wait for balance-sheet strength, margin revival, and a better margin of safety. As Graham said, price is what you pay, value is what you get. Right now, the value is uncertain and the price is not low enough to compensate. I need more evidence of earnings stabilisation before I write a cheque.

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