JP Power Ven. (JPPOWER)

FairStock Score: 50/100 — MIXED

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

Key Financials

Strengths

• Book value of ₹17.92 and Graham Number of ₹19.26 are close to the market price, offering some asset support.
• Reported free cash flow of ₹1,753 Cr implies a healthy yield against the ₹10,452 Cr market cap.
• Piotroski F-Score of 7/9 indicates relatively sound balance-sheet health despite weak earnings.
• Debt/Equity is low at 0.31, reducing solvency risk for an asset-heavy power generator.
• ROCE of 10.26% shows the operating asset base is not completely unproductive.

Concerns

• Latest quarter net profit of only ₹4 Cr on ₹1,156 Cr sales shows severe margin compression.
• Profit growth is down 50.29%, and sales growth is negative at -2.10%.
• EV/EBITDA of 110.24 suggests cash operating earnings are minimal relative to enterprise value.
• Altman Z-Score of 1.64 is in the caution/distress zone, and DCF intrinsic value of ₹0.07 signals potential overvaluation.

AI Analysis

When I look at JP Power Ven., I first ignore the stock price and ask what the business earns. The answer is not encouraging. In the latest quarter, the company made only ₹4 Cr net profit on ₹1,156 Cr of sales—essentially a 0.3% margin. Profit growth has fallen 50.29%, and return on equity sits at 5.05%, far below what I expect from a quality enterprise. This is a commodity power generator, not a business with a pricing moat. Sales are declining 2.10%, and there is no dividend to compensate patient shareholders. But there are asset-based offsets. Book value is ₹17.92, Graham Number is ₹19.26, and the price is ₹19.90, so the market is paying close to tangible asset backing. The reported free cash flow of ₹1,753 Cr is striking—about 16.8% of the market cap—but with EV/EBITDA at 110.24, operating earnings are far too thin to justify a rosy view. The Altman Z-Score of 1.64 also sits in the caution zone, even though debt/equity is low at 0.31. The DCF value of ₹0.07 is a sharp warning that conventional cash-flow valuation does not support this price. I would treat that as a red flag rather than a typo. Piotroski F-Score of 7/9 suggests the balance sheet has not deteriorated across all metrics, and ROCE of 10.26% is not trivial. Yet with promoter holding at just 24%, minority shareholders need strong evidence that management is aligned. The margin of safety figure of 20.82% is only worthwhile if the assets can generate durable cash flows, not just accounting depreciation. I would classify this as an asset play—not a compounder. I need to see a real earnings recovery before acting.

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