Rishabh Instrum. (RISHABH)

FairStock Score: 39/100 — MIXED

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

Key Financials

Strengths

• Conservative balance sheet with debt/equity of only 0.15
• Promoter holding of 69.67% aligns interests with minority shareholders
• Piotroski F-Score of 7/9 suggests solid recent financial health
• Latest quarter net margin of about 11.4% (₹21 cr profit on ₹184 cr sales) and 139% profit growth

Concerns

• Revenue growth is just 1.34%, so the big profit jump is not backed by topline expansion
• ROE of 10.25% and ROCE of 5.43% are mediocre for the stated P/B of 4.77
• At P/E of 23.60 and zero dividend yield, the investor relies entirely on continued earnings growth
• FairStock Score of 36/100 reflects mixed fundamental quality

AI Analysis

Let me start with what I like: this is a debt-light business, with debt-to-equity of 0.15, and the promoter family owns 69.67%, so my interests are aligned with people who eat their own cooking. The Piotroski score of 7/9 also tells me the recent numbers are not riddled with accounting red flags. But a value investor must ask what the price pays for. Sales growth is just 1.34%, yet profit growth is 139%. That asymmetry is my first caution flag. You do not build long-term intrinsic value by cutting costs alone; you eventually need revenue to pull its weight. In the latest quarter, sales of ₹184 crore yielded net profit of ₹21 crore, about 11.4% margin, which is respectable, but one quarter is not a franchise. The balance sheet is conservative, but returns on capital are mediocre: ROE is 10.25% and ROCE is 5.43%. At ₹488.45, the market cap is ₹1,608 crore, which is 4.77 times book and 23.6 times earnings. For a company earning 10% on equity and barely growing sales, that is not a bargain; it is a promise that profits keep compounding. The 139% profit growth makes the PEG look cheap at 0.23, but PEG is only meaningful if that growth rate is sustainable. With sales growth of 1.34%, I have serious doubts. There is also zero dividend yield, so I get no cash compensation for waiting. The 52-week range of ₹302.50 to ₹693.35 shows how volatile the stock can be. This feels more like a turnaround - a recovering margin story - than a durable compounder. I would keep it on my watchlist, but not buy at this price without a larger margin of safety.

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