Kandarp Digi (KANDARP)

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

Key Financials

Strengths

• Revenue grew 171.66% and profit 157.14%, showing strong demand and operating momentum.
• PEG ratio of 0.42 suggests the high P/E may be justified if growth continues.
• Promoter holding at 58.77% aligns management with minority shareholders.
• Piotroski F-score of 7/9 points to sound financial position and operational efficiency.
• ROCE of 12.96% indicates reasonable return on capital employed.

Concerns

• P/E of 69.15 leaves no margin of safety; valuation is demanding for a small-cap BPO/KPO.
• Latest quarter net profit of ₹1 Cr on ₹23 Cr sales implies a thin ~4.3% margin and small absolute earnings.
• No dividend yield (0.00%), so investor returns depend entirely on future capital gains.
• Insufficient data on book value, ROE, and debt/equity make a Graham-style intrinsic value check impossible.

AI Analysis

When I first see names like Kandarp Digi, I remind myself that a wonderful business is not always a wonderful investment at any price. The growth is striking: sales are up 171.66% and profit up 157.14%, with a PEG ratio of 0.42. That would make a growth investor's heart beat faster. But I buy businesses, not momentum. This is a small BPO/KPO player with quarterly sales of ₹23 Cr and net profit of just ₹1 Cr. The net margin is barely 4%, and the market cap of ₹142 Cr means I am being asked to pay 69.15 times trailing earnings. That is a very high price for a business operating in a low-barrier, intensely competitive industry. ROCE of 12.96% is decent, but it does not signal a wide moat. Promoter holding of 58.77% is reassuring, and a Piotroski F-score of 7/9 suggests the recent expansion has not wrecked the balance sheet. Still, as Graham would say, facts are needed, and I have no book value, ROE, or debt figures. I cannot value what I cannot see. The absence of a dividend means the investor depends entirely on future price appreciation, which makes the valuation even more demanding. If the company can sustain this growth and convert more sales into profit, today's price might look reasonable someday. But valuation is the price we pay for growth, and 69 times is a lot. I would rather miss a fast grower than overpay for a fragile small business. Patience and a margin of safety come first.

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