DU Digital (DUGLOBAL)

FairStock Score: 30/100 — RISKY

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

Key Financials

Strengths

• Sales growth of 19.96% and profit growth of 48.51% show strong operating leverage
• Piotroski F-Score of 7/9 indicates solid recent financial health
• ROCE of 15.23% reflects decent capital efficiency
• Promoter holding of 54.03% aligns owner interests
• Latest quarter net margin is healthy at approximately 19% (₹6 Cr profit on ₹31 Cr sales)

Concerns

• P/E of 57.34 is steep; PEG of 1.67 suggests growth is already priced in
• Zero dividend yield offers no income cushion to shareholders
• Insufficient balance-sheet data: no book value, ROE, or debt-to-equity available for proper analysis
• Travel industry cyclicality and competitive pressures could hurt future margins

AI Analysis

Let me examine DU Digital the way Graham and Buffett would. A ₹309 crore travel-related company, priced at ₹45.65, with a quoted P/E of 57.34, is not cheap. Graham always asked for a margin of safety; at 57 times earnings, the margin is thin. The headline numbers are encouraging: sales grew 19.96%, profit grew 48.51%, and the latest quarter shows ₹31 crore revenue and ₹6 crore net profit—roughly a 19% net margin. ROCE is 15.23%, which is respectable, and the Piotroski F-Score of 7 out of 9 indicates decent financial health. Promoter holding of 54.03% means owners have skin in the game. But I have concerns. Travel and tourism is cyclical and intensely competitive; I see no clear moat. Profit growth outpacing sales growth by such a wide margin can be flattered by operating leverage, but it can reverse quickly. The company pays no dividend—zero yield—so the investor depends entirely on future price appreciation. The PEG ratio of 1.67 tells me the current growth rate is already largely reflected in the price. Most troubling is the lack of data: no book value, no ROE, no debt-to-equity. I cannot judge balance-sheet strength, and Buffett never invests in what he cannot evaluate. Given the figures, this is a fast grower, not a Graham-style bargain. The execution appears good, and the promoter stake is positive, but at ₹45.65 near the top of the 52-week range of ₹23.75 to ₹49.00, the risk-reward is unfavourable. I would wait for a lower price or evidence that profit margins and growth can be sustained. If the travel cycle turns or the multiple compresses, there could be pain. Patience is his habit—this time, patience means doing nothing.

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