Elgi Rubber Co (ELGIRUBCO)
TurnaroundScore breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹58.33 |
| Market Cap | ₹291.94 Cr |
| P/E Ratio | 0 |
| ROCE | 0.47% |
| ROE | —% |
| Dividend Yield | 0% |
| Profit Growth | 615.81% |
| Debt/Equity | 4.13 |
| Sales Growth | 8.19% |
| Promoter Holding | 65.03% |
| 52-Week Range | ₹32.72 — ₹73 |
| Sector | Industrial Products |
| Book Value | ₹15.12 |
Strengths
- Sales growth of 9.41% shows some revenue traction despite losses.
- Promoter holding at 65.03% aligns majority ownership with minority shareholders.
- Book value of ₹33.28 and latest quarterly sales of ₹100 crore provide an asset base if operations turn around.
Concerns
- Latest quarter net loss of ₹29 crore on ₹100 crore sales implies deeply negative net margin of about -29%.
- Profit growth of -699.44% and ROCE of only 0.47% signal severe profitability erosion.
- Debt/Equity of 1.83 is high, and zero dividend yield offers no compensation for risk.
- P/B of 1.62 above book value for a loss-making company leaves little margin of safety.
AI Analysis
At ₹53.78, Elgi Rubber carries a ₹200 crore market cap, yet the latest quarter tells a painful story: ₹100 crore of sales produced a ₹29 crore net loss. That is a nearly minus 29% net margin. A business that cannot turn revenue into profit has no moat; it merely churns capital. Sales growth of 9.41% is respectable, but when profit growth is minus 699.44%, that expansion is destroying value. Return on capital employed of 0.47% is close to zero, and with return on equity not available because of losses, shareholders are not earning anything. The balance sheet shows debt-to-equity of 1.83, which means the company is relying heavily on borrowed money. In a downturn, this leverage can squeeze the equity even faster. The Piotroski F-score of 4/9 confirms weak financial health. On valuation, I cannot call this a Graham bargain: book value is ₹33.28, yet the market asks ₹53.78, a price-to-book of 1.62. Paying a 62% premium over book for a loss-making, high-debt rubber company is the opposite of a margin of safety. There is no dividend, so I receive no income while waiting. Promoter holding of 65.03% does align interests, but managerial ownership cannot substitute for poor unit economics. I would need consistent profitability, declining debt, and a price closer to or below book before this becomes investable. Until then, I watch from the sidelines. In investing, you must not mistake activity for growth or hope for evidence.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer