Ethos (ETHOSLTD)
CyclicalFairStock Score: 19/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 1/2 · Dividend: 0/1
Key Financials
| Current Price | ₹2,747.4 |
| Market Cap | ₹7,351.41 Cr |
| P/E Ratio | 70.43 |
| ROCE | 13.75% |
| ROE | 10.62% |
| Dividend Yield | 0% |
| Profit Growth | 35.3% |
| Debt/Equity | 0.19 |
| Sales Growth | 33.3% |
| Promoter Holding | 50.58% |
| 52-Week Range | ₹1,919.4 — ₹3,245.9 |
| Sector | Consumer Durables |
| Book Value | ₹556.07 |
Strengths
- Revenue momentum is strong: 26.65% sales growth and latest quarterly sales of ₹469 Cr.
- Low leverage with debt/equity of 0.19, so the balance sheet is financially sound.
- Piotroski F-Score of 7/9 indicates reasonably healthy fundamentals.
- Promoter holding of 50.58% aligns management with minority shareholders.
- ROCE of 13.75% with low debt shows some capital efficiency.
Concerns
- Valuation is extremely rich at P/E 66.93, P/B 7.67, and PEG 3.92, leaving no margin of safety.
- Profit growth of 7.47% lags sales growth of 26.65%, pointing to margin pressure.
- Zero dividend yield means all returns depend on future earnings growth or multiple expansion.
- ROE of 10.62% is modest for a business trading at 7.67 times book value.
- FairStock Score of 16/100 flags the stock as risky.
AI Analysis
At ₹2,686.05, Ethos is priced at 66.93 times earnings and 7.67 times book value. That would require a truly exceptional business to deliver a margin of safety, and I don't see it in the numbers. Sales growth of 26.65% is impressive, and the latest quarter's ₹469 Cr revenue shows momentum. But profit growth of just 7.47% is a red flag: the company is adding a lot of top line without commensurate bottom-line improvement. That suggests costs, competition, or expansion pressure eating into margins. The balance sheet is clean—debt/equity only 0.19 and Piotroski F-Score 7/9—so there is no financial distress. But ROE of 10.62% and ROCE of 13.75% are not exceptional, especially when you pay 7.67 times book value. The dividend yield is zero, so the investor gets no cash return while waiting for growth. With PEG at 3.92 and the FairStock Score at 16/100, the risk-reward is clearly unfavorable. In the Graham tradition, price is what you pay and value is what you get. Here, the market is paying a rich price for a business with modest profitability and uncertain earnings quality. I would not buy at this valuation; I would watch patiently for either a meaningfully lower price or proof that profits can catch up with sales.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer