Metro Brands (METROBRAND)
Fast GrowerFairStock Score: 32/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹944.1 |
| Market Cap | ₹25,732.89 Cr |
| P/E Ratio | 63.28 |
| ROCE | 19.42% |
| ROE | 19.78% |
| Dividend Yield | 0.64% |
| Profit Growth | -5.43% |
| Debt/Equity | 0.77 |
| Sales Growth | 9.11% |
| Free Cash Flow | ₹820 Cr |
| Promoter Holding | 71.83% |
| 52-Week Range | ₹883 — ₹1,340.4 |
| Sector | Consumer Durables |
| Book Value | ₹73.16 |
Strengths
- Strong capital efficiency with ROE of 19.78% and ROCE of 19.42%
- Consistent high growth: 5-year revenue CAGR of 25.66% and profit growth of 35.71%
- Promoter holding of 71.83% aligns management interests with shareholders
- Healthy financials: positive free cash flow of ₹820 Cr and Piotroski score of 7/9
- Latest quarter net margin around 16% (₹130 Cr profit on ₹811 Cr sales)
Concerns
- Extremely rich valuation: P/E of 73.95 and P/B of 14.51, leaving limited margin of safety
- PEG ratio of 2.89 suggests the growth is not cheaply priced
- Recent sales growth of 15.39% is below the 5-year CAGR, indicating deceleration
- Debt-equity of 0.79 adds moderate financial risk, and dividend yield is a low 0.52%
AI Analysis
Metro Brands is a quality footwear business that has compounded revenue at 25.66% over five years, with profit growth of 35.71%. The latest quarter shows ₹811 Cr in sales and ₹130 Cr in profit—a net margin near 16%. ROE and ROCE of 19.78% and 19.42% are impressive. Promoters own 71.83%, so our interests are aligned. Free cash flow of ₹820 Cr and a Piotroski score of 7/9 suggest the earnings are real and the balance sheet is healthy. As Graham would say, though, the price is where I must be disciplined. At ₹1054.25, the market cap stands at ₹28,790 Cr. That is 73.95 times earnings and 14.51 times book value. For a business growing sales at 15.39%, the PEG ratio of 2.89 tells me I am paying a high price for growth that may already be decelerating—the 5-year revenue CAGR of 25.66% is tapering. Debt/equity of 0.79 is manageable but not zero. The dividend yield of 0.52% is nominal. The business has a moat in branded footwear retail, but the valuation leaves no margin of safety. I want to own a great company, but I also want to buy it at a sensible price. Today, the stock is a fast grower with excellent fundamentals, yet the current price bakes in perfection. I would place this on my watchlist and wait for a more reasonable entry point, or for the company's earnings to grow into its valuation.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer