Kataria Indust. (KATARIA)

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

Key Financials

Strengths

• Sales growth of 20.43% indicates strong demand for products
• ROCE of 13.37% shows decent capital efficiency relative to the industrial sector
• Promoter holding of 74.98% ensures strong owner alignment with minority shareholders
• Latest quarter sales of ₹170 Cr reflects meaningful operating scale
• PEG ratio of 1.11 is not exorbitant if growth can be sustained

Concerns

• Profit growth of -17.86% despite 20.43% sales growth signals severe margin compression
• Net profit margin is razor-thin at ~2.35% (₹4 Cr profit on ₹170 Cr sales)
• Piotroski F-score of 4/9 points to weak financial health and operational deterioration
• P/E of 22.6 with declining earnings leaves little room for error, and no dividend is paid

AI Analysis

Looking at Kataria Indust., I'm reminded that a business is only as good as its earnings power. Sales grew an impressive 20.43% to ₹170 Cr in the latest quarter, but net profit was a mere ₹4 Cr. That's a margin of roughly 2.35% - extremely thin for an industrial products company. And over the year, profit actually fell 17.86% despite that revenue growth. This tells me the company is buying growth at the cost of profitability, or facing pricing pressure. At ₹120, I'm asked to pay 22.6 times earnings. For a business whose earnings are shrinking, that's no bargain. The ROCE of 13.37% is respectable, but not exceptional. Promoter holding at 74.98% is reassuring; owners have skin in the game. However, the Piotroski F-score of 4 out of 9 signals weak fundamental health. There's no dividend to compensate while I wait. Graham would say price is what you pay, value is what you get. Here, the value is unclear; with no book value or debt-to-equity disclosed, I can't assess downside protection. The stock trades near its 52-week high of ₹125.85, offering little margin of safety. While the top-line growth is enticing, and the PEG ratio suggests reasonable valuation if growth persists, I need to see profits follow sales. Until margins recover and earnings growth turns positive, this remains a cyclical business to watch, not a compounding machine.

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