Rajshree Polypac (RPPL)

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

Key Financials

Strengths

• Trading at a 30% discount to book value: price ₹16.26 vs book value ₹23.22.
• Low P/E of 8.48 and PEG of 0.27, with profit growth of 31.74%.
• Piotroski F-score of 6/9 suggests reasonably sound fundamentals.
• Promoter holding of 43.90% aligns owner-management interests.
• ROCE of 11.01% is respectable given debt/equity of 0.70.

Concerns

• Sales growth is negative at -1.49%, showing no top-line expansion.
• No dividend yield of 0.00%; shareholders get no cash return while holding.
• Latest quarter net profit of ₹2 Cr on ₹72 Cr sales implies thin margins.
• Trailing P/E may overstate sustainable earnings if quarterly profit run-rate is lower.

AI Analysis

At ₹16.26, Rajshree Polypac sells for less than 70% of its book value of ₹23.22. That is the first clue a Grahamite notices. The packaging industry is not a wonderful business; it is competitive, capital-consuming, and offers few durable moats. Still, this is a price that offers a margin of safety. The trailing P/E is 8.48, and even with a moderate debt-to-equity of 0.70, ROCE of 11.01% is respectable. Promoters hold 43.90%, so their interests are aligned with ours. What bothers me: sales fell 1.49%, and there is no dividend yield. A business that cannot generate cash to pay owners while trading below book needs scrutiny. The latest quarter shows ₹72 Cr sales and only ₹2 Cr net profit. If that quarterly profit is representative, the annualized earnings power is much lower than the P/E suggests. Profit growth of 31.74% looks encouraging, but with shrinking sales, this could be cost-cutting or tax effects, not underlying demand. The Piotroski F-score of 6/9 is decent, not spectacular. I would not call this a fast grower. It is closer to an asset play: you are paying ₹16.26 for ₹23.22 of book value, with a moderate earnings yield and a balance sheet that is not alarming. The low PEG of 0.27 is seductive, but in a cyclical packaging business, low P/E and low PEG can be value traps if earnings fall. I need to see stabilization in sales and better return on equity before treating it as a core holding. If the company maintains ROCE and converts book value into earnings, the discount should narrow. I would monitor quarterly sales, debt levels, and the promoter's actions. Patience, not excitement.

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