GRP (GRPLTD)

FairStock Score: 33/100 — RISKY

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

Key Financials

Strengths

• ROE and ROCE both around 17.5%, showing decent capital efficiency even in a weak earnings year
• Sales growth stayed roughly flat at 1.85%, with latest quarter revenue of ₹135 Cr, so the operating base has not collapsed
• Promoter holding of 40.06% provides some alignment with minority shareholders
• The stock trades about 21% below its 52-week high of ₹2,491, and book value of ₹322.33 provides a reference point

Concerns

• Net profit fell 53.65%; the latest quarter net profit of just ₹1 Cr on ₹135 Cr sales implies razor-thin margins
• P/E of 38.4 and PEG of 20.76 are extremely stretched for a low-growth, profit-declining business
• Piotroski F-Score of 4/9 and FairStock Score of 8/100 point to weak financial health
• Debt/equity of 1.12 combined with collapsing profits raises repayment and refinancing risk

AI Analysis

Let me look at GRP through Graham's lens. A rubber company with a ₹967 crore market cap and a trailing P/E of 38.4 immediately demands excellence. What do I get? Sales growth of only 1.85% and profits down 53.65%. The latest quarter earned just ₹1 crore on ₹135 crore of sales — that is not a wonderful business at a fair price; that is a cyclical showing its teeth. ROE and ROCE around 17.5% look nice, but they are calculated on a shrinking earnings base. Graham would ask: is there a margin of safety? Book value is ₹322.33 against a price of ₹1,967.90, so P/B is 6.11 — no asset cushion. Debt/equity of 1.12 is tolerable for a stable enterprise, but with profits collapsing, leverage becomes a real risk. The Piotroski score of 4 out of 9 tells me financial health is deteriorating. Promoter holding of 40.06% is decent but not a moat. In rubber, pricing power is limited and the earnings cycle is harsh. With a PEG ratio of 20.76, the market is paying a growth multiple for a business that is shrinking. I cannot call this a compounding machine. The dividend yield of 0.80% offers little comfort. At best, this is a cyclical that may recover; at worst, a value trap. I would wait for either a much lower price or concrete evidence of margin recovery, not just a fluctuating share price between ₹1,500 and ₹2,491. The current quote of ₹1,967.90 gives no statistical bargain. My discipline: no story, no forecast. Show me earnings and margin stability, then we can talk.

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