Regaal Resources (REGAAL)

FairStock Score: 46/100 — MIXED

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

Key Financials

Strengths

• Sales growth of 25.56% and profit growth of 28.67% show strong recent momentum.
• PEG of 0.50 with a P/E of 13.54 suggests the market is not overpaying for growth.
• Piotroski F-Score of 7/9 indicates reasonably healthy fundamentals.
• Promoter holding of 70.45% aligns owner interests with minority shareholders.
• ROCE of 16.15% reflects a decent return on capital employed.

Concerns

• Debt-to-equity of 1.09 is elevated for a commodity-linked agricultural business.
• Zero dividend yield means minority shareholders receive no direct cash return.
• ROE is N/A, leaving a gap in assessing shareholder-level profitability.
• Latest quarter net margin is thin at roughly 4% (₹13 Cr profit on ₹323 Cr sales), making earnings sensitive to cost or price shocks.

AI Analysis

At ₹84.70, I am being asked to pay ₹748 crore for a business that earned roughly ₹55 crore on a trailing P/E of 13.54. That is not an expensive entry price, but cheap is not the same as good. Regaal operates in other agricultural products, and I have learned that agricultural commodities rarely build wide moats. Sales grew 25.56% and profit grew 28.67%, giving a PEG of 0.50; that looks attractive only if the growth is durable. The latest quarter shows ₹323 Cr sales and ₹13 Cr net profit, a thin ~4% margin, so any cost or price hiccup can hurt. ROCE at 16.15% is decent, but debt-to-equity of 1.09 concerns me. Leverage in a cyclical, commodity-like business can convert a bad season into a permanent impairment. Promoter holding at 70.45% is a positive, as owners have skin in the game, though it leaves less floating stock. I would have liked a dividend; zero yield means minority shareholders depend entirely on reinvestment and Mr. Market’s mood. The 52-week range of ₹57.27 to ₹145.70 shows how violent sentiment can be; today’s price is well below the high, so some froth has been removed. Piotroski F-Score of 7/9 gives some comfort on fundamentals, but it does not tell me about pricing power or management capital allocation. ROE is shown as N/A, and that bothers me: I want to see whether shareholder equity is earning a return. This is a fast grower at a reasonable valuation, but I would not anchor on growth alone. I need evidence of margin stability, disciplined leverage, and a durable demand base before treating it as a compounding machine.

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