Omax Autos (OMAXAUTO)

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

Key Financials

Strengths

• Trades below book value: P/B of 0.77 against book value of ₹147.46
• Low leverage with debt-to-equity of 0.23 and a 2.33% dividend yield
• Promoter holding at 53.22% aligns interests with minority shareholders
• Strong recent momentum: sales ₹122 Cr and net profit ₹12 Cr in the latest quarter; sales growth of 32.39%
• Piotroski F-Score of 7/9 points to improving financial fundamentals

Concerns

• ROE of 6.48% and ROCE of 9% are mediocre; capital is not being deployed at high returns
• Profit growth of 325.78% is from a low base, making the PEG ratio of 0.06 misleading
• Auto components is cyclical, and the stock has fallen sharply from its 52-week high of ₹263.40 to ₹113.54
• Price below book value may reflect market skepticism about asset quality or future earnings power

AI Analysis

At ₹113.54, Omax Autos sells below its book value of ₹147.46 and at a P/E of 10.52. That immediately catches my attention. In Graham's spirit, I like a margin of safety. But a low price is only half the story. The business earns a middling 6.48% on equity and 9% on capital employed. That is not a great franchise; it is a cyclical auto-components player with limited pricing power. There is some financial discipline: debt-to-equity is only 0.23, the dividend yield is 2.33%, and promoter holding is 53.22%. An F-score of 7/9 also suggests a cleaner balance sheet. Sales grew 32.39%, and reported profits exploded 325.78%, but from a low base. That explains the remarkable PEG of 0.06; I would not treat that as a reliable measure of value. The latest quarter shows sales of ₹122 Cr and net profit of ₹12 Cr, which, if repeated, would make the share look inexpensive. But auto parts are inherently cyclical. The 52-week range of ₹84.50 to ₹263.40 is a warning. Buying near the lower end offers comfort, but the wide swing reminds me that mean reversion can hurt those who overpay for cyclical earnings. I see a classic turnaround rather than a compounder. The book value provides a floor only if the assets are good and earnings keep improving. I would watch how this quarterly improvement translates into sustained returns and whether ROE climbs above the cost of capital. If not, the discount to book is deserved. I would not blindly chase 325% growth. Let the next few quarters tell me whether this is a true value story or a value trap.

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