Kapston Services (KAPSTON)
Fast GrowerFairStock Score: 38/100 — MIXED
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹588.4 |
| Market Cap | ₹1,790.63 Cr |
| P/E Ratio | 63.68 |
| ROCE | 12.85% |
| ROE | —% |
| Dividend Yield | 0% |
| Profit Growth | 38.6% |
| Debt/Equity | 1.58 |
| Sales Growth | 16.2% |
| Promoter Holding | 72.87% |
| 52-Week Range | ₹238.76 — ₹600 |
| Sector | Commercial Services & Supplies |
| Book Value | ₹38.23 |
Strengths
- High promoter holding of 72.87% aligns management interests with minority shareholders
- Profit growth of 62.91% on 16.38% sales growth suggests improving operating leverage
- Piotroski F-Score of 7/9 indicates solid financial health and accounting quality
- PEG ratio of 0.79 implies valuation may be reasonable if growth rate is sustainable
- Latest quarter net profit of ₹7 Cr on ₹212 Cr sales shows continued profitability
Concerns
- Debt-to-equity of 1.72 indicates a leveraged balance sheet
- P/E of 31.46 and P/B of 10.10 leave no margin of safety
- Zero dividend yield offers no cash return to shareholders
- ROCE of 12.85% is moderate and may not justify the high valuation
AI Analysis
Looking at Kapston Services, I am reminded of Graham's warning: price is what you pay, value is what you get. The market is asking ₹338.15 for a share with book value of ₹33.47 and earnings that justify a P/E of 31.46. That is a rich price for a company with a thin net margin—just ₹7 crore profit on ₹212 crore of quarterly sales. Sales growth of 16.38% is encouraging, and the 62.91% profit growth is impressive, but I have to question whether that can continue. With debt-to-equity of 1.72, the business carries meaningful leverage. Return on capital employed is 12.85%, which is acceptable but not exceptional, and I am not given an ROE figure, which raises my suspicion. The Piotroski score of 7/9 does suggest decent financial health, and promoter holding of 72.87% is a positive sign—owners have skin in the game. Still, I get no dividend while waiting, and at a P/B of 10.10, there is no margin of safety. The PEG of 0.79 would attract growth investors, but Graham would advise caution: low PEG ratios often appear before earnings disappoint. This is a fast-growing service company, but it is not a sturdy stalwart. I need to see leverage reduced and margins expanded before I consider it a true value opportunity.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer