Menon Bearings (MENONBE)

FairStock Score: 54/100 — MIXED

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

Key Financials

Strengths

• High promoter holding of 68.44% aligns owner interests with minority shareholders.
• Strong profitability with ROE of 21.98% and ROCE of 19.63%.
• Low leverage with debt/equity of 0.33 and Piotroski F-Score of 7/9.
• PEG of 0.42 against a P/E of 20.94 suggests recent growth is not fully priced.
• Dividend yield of 1.72% provides modest income while waiting.

Concerns

• P/B of 5.61 is expensive on book value, leaving little asset-based margin of safety.
• Stock has fallen sharply from its 52-week high of ₹254.25 to ₹121.12, indicating market skepticism.
• Auto-components is cyclical; 69.10% profit growth may not be sustainable.
• FairStock Score of 53/100 is mixed, not a clear value signal.

AI Analysis

When I look at Menon Bearings, I see a business that earns good returns without loading up on debt. Return on equity of 21.98% and ROCE of 19.63% are respectable, and with debt-equity of just 0.33, the balance sheet is not a worry. The promoter holding of 68.44% tells me the owners remain deeply invested. The Piotroski score of 7 out of 9 also suggests financial health is intact. But I have to be careful: 69.10% profit growth and 31.72% sales growth look wonderful, yet in an auto-component cyclical, good times often tempt investors to pay for yesterday's boom. At ₹121.12, the P/E is 20.94 times earnings and P/B is 5.61 times book. That is not a bargain on assets. However, with a PEG of 0.42, the market is paying far less than the recent growth rate. That is interesting. The stock has nearly halved from its 52-week high of ₹254.25; at the current price, Mr. Market is fearful. The dividend yield of 1.72% gives some return while waiting. Let me remember Benjamin Graham: price is what you pay, value is what you get. If the company can sustain even a portion of its growth, the valuation may be reasonable. But I require margin of safety. The latest quarter shows ₹77 Cr sales and ₹9 Cr net profit, so margins are healthy. Still, the FairStock score of 53/100 is mixed, so I would not rush. I would watch quarterly sales and profit trends, debt levels, and auto demand. If growth decelerates, the current multiples could quickly look heavy. This is a fast grower, not a stalwart, and I would only buy with eyes open to cyclical risk.

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