Filatex India (FILATEX)

FairStock Score: 45/100 — MIXED

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

Key Financials

Strengths

• P/E of 10.41 and P/B of 1.50 versus ROE of 14.90% leave a margin of safety
• Low debt-to-equity of 0.10 indicates a conservative balance sheet
• ROCE of 14.08% and ROE of 14.90% are respectable for a textile player
• Profit growth of 16.68% with PEG of 0.62 suggests reasonable earnings momentum
• Promoter holding of 65.38% aligns management with minority shareholders

Concerns

• Sales declined 1.78%, showing weak top-line momentum
• Latest quarter net margin is thin at roughly 5.24% on ₹1,050 Cr sales and ₹55 Cr profit
• Dividend yield of 0.58% provides little income while waiting
• Wide 52-week range of ₹36.26 to ₹85.69 highlights cyclicality and volatility

AI Analysis

Filatex India reminds me that in textiles, price is what you pay and earnings are often cyclical. At ₹42.59, the market values the company at ₹1,926 Cr, and the price-to-earnings ratio of 10.41 is not demanding. Book value stands at ₹28.30, so I am paying only 1.5 times book for a business earning 14.90% on equity and 14.08% on capital employed. Those are respectable returns, and with debt at just 0.10 times equity, this balance sheet does not keep me awake at night. But I must be honest: the latest quarter shows sales of ₹1,050 Cr and net profit of ₹55 Cr, yet annual sales have declined 1.78%. That tells me this is a cyclical business, not a reliable compounding machine. Profit growth of 16.68% is pleasant, but I need to understand whether margins are sustainable or merely a favourable moment in the textile cycle. The 52-week range of ₹36.26 to ₹85.69 screams volatility; anyone who paid ₹85 has suffered deeply. Promoter holding of 65.38% does align interests, which I respect. But a dividend yield of only 0.58% means I am not being paid well to wait. The Piotroski score of 6 out of 9 is acceptable, not excellent, and a PEG of 0.62 looks cheap only if current profit growth continues. With sales shrinking, I would not extrapolate that growth too far. Sewing thread and polyester yarn likely lack a durable moat in a competitive commodity industry. Still, at 10.41 times earnings, with low debt and decent returns on capital, it deserves a place on my watchlist. I need evidence of sales turning positive and margins holding before I take a meaningful position.

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