Lloyds Metals (LLOYDSME)

FairStock Score: 76/100 — STEADY

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

Key Financials

Strengths

• 5-year revenue CAGR of 93% with latest quarter sales of ₹5,058 Cr indicates exceptional demand.
• ROE of 38.48% and ROCE of 38.28% showcase superior capital efficiency.
• Promoter holding of 63.63% aligns management interests with minority shareholders.
• Piotroski F-Score of 8/9 and Altman Z-Score of 7.61 reflect strong financial health.
• Profit growth of 58.99% demonstrates continued earnings momentum.

Concerns

• Valuation has no margin of safety: P/E 27.29, P/B 14.46, Graham Number ₹361.80, and MoS -240.80%.
• Free cash flow is deeply negative at ₹-2,771 Cr despite healthy reported profits.
• Debt/Equity of 1.06 could strain the balance sheet if cash generation falters.
• Dividend yield of 0.08% offers negligible downside support.

AI Analysis

When I look at Lloyds Metals, the growth numbers first catch my eye: five-year revenue CAGR of 93%, and latest quarter sales of ₹5,058 Cr with net profit of ₹1,090 Cr. That kind of compounding is rare. ROE of 38.48% and ROCE of 38.28% indicate a business that earns well on capital. But high returns attract competition; the moat must be durable. Promoter holding of 63.63% is helpful, aligning ownership with minority investors. Piotroski F-Score of 8/9 and Altman Z-Score of 7.61 suggest financial strength, though debt/equity of 1.06 is not negligible. The real problem for me is price. At ₹1,697.80, the P/E is 27.29, P/B is 14.46, and EV/EBITDA is 17.09. Graham would look at book value of ₹117.43 and a Graham number of ₹361.80; the market is paying 14.5 times book and nearly five times Graham's conservative estimate. Negative free cash flow of ₹-2,771 Cr tells me growth is consuming cash—that may be fine if it funds capacity, but it makes valuation sensitive to execution. Dividend yield of only 0.08% means I am not getting paid to wait. With margin of safety at -240.80%, there is almost no room for error. This is a fast grower, and a high-quality one by the numbers. But a great business is only a great investment at the right price. At 27 times earnings, I need the 93% growth trajectory to persist for years. If it stumbles, the downside is severe. I would want a much lower entry price or evidence that free cash flow turns strongly positive before committing new capital.

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