Jyoti CNC Auto. (JYOTICNC)

FairStock Score: 58/100 — STEADY

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

Key Financials

Strengths

• High profitability: ROE of 21.02% and ROCE of 24.35% show strong capital efficiency.
• Low leverage: Debt/Equity of 0.40 and Altman Z-Score of 6.00 indicate a financially stable balance sheet.
• Strong historical growth: 5-year revenue CAGR of 27.86% and latest quarter revenue of ₹576 crore show momentum.
• High promoter holding of 62.55% aligns management with public shareholders.
• Piotroski F-Score of 7/9 suggests broadly sound fundamentals.

Concerns

• Extreme valuation: P/E of 52.65, P/B of 10.18, and EV/EBITDA of 92.54 leave little margin of safety.
• Negative free cash flow of ₹-434 crore despite reported profits, raising questions about earnings quality and capital intensity.
• Profit growth of 15.56% lags revenue growth of 22.31%, indicating possible margin pressure.
• Zero dividend yield means investors rely entirely on future price appreciation.

AI Analysis

Let me look at Jyoti CNC Auto through the lens I have used for decades: a wonderful business can still be a terrible investment if you pay too much. Here we have an industrial-products company with impressive metrics: return on equity of 21.02%, ROCE of 24.35%, and a debt-to-equity ratio of just 0.40, which tells me management has not been reckless. The Altman Z-Score of 6.00 also suggests the balance sheet is sturdy. Promoters own 62.55%, so their interests are broadly aligned with minority shareholders. Revenue has compounded at 27.86% over five years, and the latest quarter shows sales of ₹576 crore and net profit of ₹89 crore. That is genuine momentum. But Graham would ask: what is the price of admission? At ₹754.90, the market cap is ₹18,659 crore, about 52.65 times trailing earnings and 10.18 times book value. The Graham Number is only ₹332.57, so the margin of safety is deeply negative, around -146.70%. Even worse, free cash flow is minus ₹434 crore; profits are on paper, but cash is going out. The company pays no dividend, so my return depends entirely on someone else paying more later. The quoted PEG of 0.65 only makes sense if future growth accelerates well beyond today's 15.56% profit growth and 22.31% sales growth. A machine-tools business is also cyclical, and paying 92.54 times EV/EBITDA for a cyclical at this point leaves no room for error. This is a fine company, perhaps even a great one, but not a Graham-style bargain. I need a margin of safety. At ₹754.90, I pass.

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