Mangalam Organic (MANORG)

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

Key Financials

Strengths

• Reasonable valuation: P/E of 12.81 and P/B of 1.39 against book value of ₹330.36
• Strong reported sales growth of 32.59% with a PEG of 0.50
• Piotroski F-Score of 7/9 suggests improving financial health
• High promoter holding of 58.65% aligns owner interests

Concerns

• Weak profitability: ROE of just 4.25% and ROCE of 7.48%
• Very thin margin: only ₹4 crore profit on ₹164 crore quarterly sales
• Debt/equity of 1.14 and no dividend leave little cushion for a downturn
• Commodity chemicals business likely lacks pricing power and a durable moat

AI Analysis

At first glance, Mangalam Organic looks like a classic cyclical commodity chemical business, and I must be honest: the surface numbers do not make my heart beat fast. The company grows, with sales up 32.59%, but it earns only ₹4 crore on ₹164 crore of quarterly sales. That is a thin, fragile margin. Over a full year, return on equity is just 4.25% and ROCE is 7.48%. A business that earns less on capital than a simple bond would not excite Graham. The balance sheet carries debt at 1.14 times equity; not ruinous, but enough to demand attention in a cyclical downturn. There is no dividend, so the shareholder must rely on price appreciation and reinvested growth. What I do like is the price. At ₹457.60, the P/E is 12.81 and P/B is 1.39 against book value of ₹330.36. If the company can keep growing earnings near the reported 18.96%, the PEG ratio of 0.50 suggests the market is not paying for that growth. The Piotroski score of 7 out of 9 hints at improving fundamentals, and promoter holding of 58.65% aligns owners with outsiders. But I must remember: commodity chemicals is a price-taking world. There is no enduring brand, no pricing power, and no visible moat. The 52-week range shows the stock has fallen from ₹637.85 to ₹457.60, another reminder that cyclical earnings can reverse. So I would call this a Cyclical, not a wonderful compounder. It may be worth studying if the balance sheet stays comfortable and the next few quarters show margin expansion. I would not buy solely on the low P/E; I need proof that management can convert rising sales into rising profits.

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