Hind Rectifiers (HIRECT)
Fast GrowerFairStock Score: 34/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹1,256 |
| Market Cap | ₹4,317.15 Cr |
| P/E Ratio | 96.17 |
| ROCE | 21.6% |
| ROE | 36.86% |
| Dividend Yield | 0.11% |
| Profit Growth | -26.7% |
| Debt/Equity | 1.19 |
| Sales Growth | 20.3% |
| Promoter Holding | 43.93% |
| 52-Week Range | ₹565.2 — ₹1,379.15 |
| Sector | Industrial Manufacturing |
| Book Value | ₹60.69 |
Strengths
- High ROE of 36.86% and ROCE of 21.60% indicate efficient capital allocation.
- Sales growth of 44% and profit growth of 47.85% demonstrate strong momentum.
- Piotroski F-score of 7/9 suggests sound financial health.
- Promoter holding of 43.93% aligns management interests with minority shareholders.
Concerns
- P/E of 46.41 and P/B of 11.97 leave little margin of safety for investors.
- Dividend yield of 0.14% is negligible; returns depend entirely on capital appreciation.
- Debt/Equity of 1.09 is elevated for an industrial products business.
- Latest quarter net margin of ~5.8% is thin, indicating limited pricing power.
AI Analysis
At first glance, Hind Rectifiers looks like a growth machine. Sales up 44%, profit up nearly 48%, ROE at 36.86% and ROCE at 21.60% — these are outstanding numbers. But as Graham taught, price is what you pay, value is what you get. At ₹917.50, the market capitalizes the company at ₹2,437 crore, or 46.41 times earnings. That is no bargain. Book value is only ₹76.66, so you're paying nearly 12 times book. For an industrial products company with debt/equity of 1.09 and a dividend yield of 0.14%, that's a rich price. I prefer businesses that pay me to wait. The Piotroski F-score of 7 suggests decent financial health, and promoter holding of 43.93% aligns interests. But the latest quarter shows net profit of ₹14 crore on sales of ₹243 crore — a thin margin of about 5.8%. The market is pricing in continued rapid growth. With a PEG around 1.0, if the 47.85% profit growth can be sustained, the valuation is fair, not cheap. However, sustaining such growth in a competitive industrial environment is no easy task. I would want to see order book visibility and improving margins before entering. The 52-week range of ₹565 to ₹1379 shows the stock is volatile. In short, this is a quality growth story, but I would wait for a margin of safety. A great company is not a great purchase if you overpay.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer