Rainbow Child. (RAINBOW)

FairStock Score: 56/100 — STEADY

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

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a Buffett/Graham investor, I look first for a durable business at a sensible price. Rainbow Child has some quality markers: ROE 17.55%, ROCE 18.69%, Piotroski F-Score 8/9, Altman Z-Score 5.05, and positive FCF of ₹128 Cr. Sales growth of 19.57% and a five-year revenue CAGR of 16.09% suggest demand for its hospital services; latest quarter sales were ₹445 Cr with net profit ₹74 Cr. Promoter holding of 49.84% is meaningful. But the profit picture is less impressive: profit growth is only 1.91%, so revenue is not translating efficiently. Debt/equity of 0.54 is not alarming but not negligible. The moat—if any—would come from hospital network and sticky patient demand, yet the numbers alone don't prove pricing power. Valuation is the real problem. At ₹1461.80, P/E is 52.08, P/B is 9.00, EV/EBITDA is 131.33, and dividend yield is just 0.24%. Graham Number is ₹289.75 and DCF intrinsic value is ₹172.27; the margin of safety is -310.60%. I would not pay this price for 1.91% profit growth. Even a steady hospital business must be bought with a margin of safety. FairStock Score 56/100 ('STEADY') captures that: steady, not cheap. Overall, the business looks decent but the stock is priced for perfection. For an Indian retail investor, this is a watchlist candidate, not a value buy, unless earnings accelerate sharply. I'd wait for a much lower price or clear profit-growth confirmation.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

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