Mallcom (India) (MALLCOM)

FairStock Score: 18/100 — RISKY

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

Key Financials

Strengths

• High return on equity of 23.07% indicates efficient use of shareholder capital.
• Sales growth of 11.38% and profit growth of 12.40% show stable, compounding momentum.
• Piotroski F-Score of 7/9 reflects sound financial fundamentals.
• Debt/Equity of 0.37 is moderate and not alarming.
• Promoter holding of 73.68% aligns management interests with minority shareholders.

Concerns

• P/E of 22.10 and PEG of 1.86 suggest the stock is not cheap relative to its growth rate.
• ROCE of 14.41% is significantly lower than ROE, indicating leverage contributes to equity returns.
• Dividend yield of only 0.26% means investors depend almost entirely on capital appreciation.
• FairStock Score of 33/100 flags the stock as risky at current levels.

AI Analysis

At ₹1,094, Mallcom is a small-cap industrial with a market cap of ₹722 Cr. The first thing I check is whether a business earns good returns without excessive debt. A 23.07% ROE is impressive, and with book value at ₹394.51, the company is using shareholders' capital well. Debt/equity of 0.37 is manageable, though not pristine. The Piotroski score of 7 out of 9 also points to a financially sound enterprise. The growth story is modest but consistent: sales grew 11.38% and profits grew 12.40%, roughly in sync. There is no sign of margin collapse or a one-time earnings spike. That is the kind of steady, if unexciting, compounding I respect. But valuation matters enormously. At 22.10 times earnings and 2.77 times book value, I am paying a full price. Graham would insist on a margin of safety; here, the PEG ratio of 1.86 tells me the market has already priced in continued double-digit growth. The dividend yield is just 0.26%, so almost all my return depends on the company delivering on those expectations year after year. ROCE of 14.41% is respectable, but lower than ROE, which tells me leverage is doing some of the heavy lifting. That is not necessarily bad, but it is far from franchise-like economics. The stock trades 28% below its 52-week high of ₹1,520, which could be a chance, but it also warns me that Mr. Market is worried about something. With a FairStock Score of 33/100, this is a risky buy at the current price. I would wait for a lower price or more evidence of sustained growth. As of now, it is a good business at an expensive price.

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