P S Raj Steels (PSRAJ)

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

Key Financials

Strengths

• ROCE of 19.30% indicates decent capital efficiency despite industry cyclicality
• Promoter holding at 73.20% aligns owner interest and suggests commitment
• Piotroski F-Score of 6/9 points to moderately sound financial health
• Latest quarter remains profitable: ₹4 Cr net profit on ₹131 Cr sales

Concerns

• Sales declined 6.13% while the stock trades at a P/E of 28.34, leaving little margin of safety
• PEG of 12.16 implies valuation is far ahead of actual profit growth of just 2.33%
• Zero dividend means no income support while waiting for cyclical recovery
• Missing book value, ROE, and debt/equity data makes a full Graham-style balance sheet check impossible

AI Analysis

When I look at P S Raj Steels, I see a small iron and steel player with a cyclical heartbeat. Sales are down 6.13%, so this business is not compounding. Profit growth of 2.33% is negligible, and at 28.34 times earnings with a PEG above 12, the market is paying for a growth story the numbers do not support. ROCE of 19.30% is respectable, but without debt-to-equity and book value figures, I cannot judge whether leverage is propping up returns. Graham would demand a margin of safety; a P/E near 28 with declining sales offers little. The latest quarter's net profit of ₹4 Cr on sales of ₹131 Cr is barely a 3% margin, typical of a cyclical manufacturer with limited pricing power. Promoter holding of 73.20% is a positive, but it does not change the economics. The 52-week range of ₹76.10 to ₹439.95 shows how violent steel earnings can be, and the current price sits closer to the middle, not at a distressed level. With zero dividend, the shareholder depends entirely on price appreciation, which is a dangerous bet in a commodity cycle. The Piotroski F-Score of 6/9 suggests the financial health is not collapsing, but it does not make the valuation attractive. I would wait for a lower price, visible sales growth, and full disclosure of book value and debt before committing capital. For now, this is a cyclical, not a compounder.

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