Rajgor Castor (RCDL)

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

Key Financials

Strengths

• Low trailing P/E of 6.97 offers a statistically cheap entry, if earnings hold.
• ROCE of 17.35% indicates decent return on capital employed.
• Promoter holding of 60.02% aligns management with minority shareholders.
• Latest quarter remains profitable with ₹2 Cr net profit on ₹279 Cr sales.
• Small ₹62 Cr market cap leaves room for niche expansion if managed well.

Concerns

• Profit growth is -5.23% and sales growth is 0.38%; PEG of 18.34 shows valuation is not supported by growth.
• Piotroski F-score of 4/9 suggests weak financial health; missing book value, ROE and D/E hampers balance-sheet verification.
• Extremely thin net margin of about 0.7% provides no cushion against commodity price swings.
• Dividend yield of 0.38% is negligible for shareholders waiting for value realisation.

AI Analysis

Let's start with what I see. A ₹62 crore market cap and a P/E of 6.97 looks like a stereotypically cheap small-cap. But cheapness must be measured against quality and future earning power. Rajgor Castor earns its keep in edible oil, specifically castor, a commodity business. In such trades, there is seldom a durable moat; the buyer can switch suppliers, and margins are dictated by global rates and seed costs. Latest quarter sales are ₹279 crore with net profit of just ₹2 crore. That is roughly 0.7% net margin. A business that keeps only 70 paise from every ₹100 of sales leaves no cushion for an adverse shift in raw material prices. Growth is absent: sales grew 0.38% and profit fell 5.23%. The PEG ratio of 18.34 tells me the current earnings multiple is not validated by future expansion. The Piotroski score of 4 out of 9 is a warning; the balance-sheet quality is below what I like. I also lack book value, ROE, and debt-to-equity figures. Graham would insist on knowing what the asset base and leverage are before paying even a low multiple. Without that, I cannot estimate downside protection. The positives are modest. ROCE at 17.35% shows existing capital is being used reasonably efficiently. Promoter holding at 60.02% provides some assurance that owners remain invested. The dividend yield, however, is a trifling 0.38%, so I am not being paid to wait. This may be a cyclical, not a steady compounder, because castor oil is tied to the agricultural commodity cycle. At ₹25.30, mid-range against the 52-week band, I see no margin of safety compelling enough to act. I would wait for evidence of margin expansion, lower debt, and better disclosure before considering this a true Graham-value candidate.

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