Sagardeep Alloys (SAGARDEEP)

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

Key Financials

Strengths

• Sales growth of 43.22% shows strong top-line momentum
• Debt/Equity of 0.40 is relatively modest for a manufacturing business
• P/B of 1.27 means the market price is not far above book value of ₹19.02
• Promoter holding of 73.56% aligns management interest with minority shareholders

Concerns

• Profit growth collapsed by 65.52%, and latest quarter net profit is ₹0 Cr
• ROCE of 7.56% is weak, suggesting poor capital efficiency
• Piotroski F-Score of 4/9 indicates deteriorating financial health
• No dividend and a P/E of 21.39 offer little compensation while earnings decline

AI Analysis

When I look at Sagardeep Alloys, I see a small, commodity-oriented business with top-line momentum but worrisome earnings quality. Sales grew 43.22%, but profits fell 65.52% and the latest quarter net profit is virtually ₹0 Cr. That tells me revenue growth is not translating into shareholder earnings — likely pricing pressure or a cost squeeze in aluminium, copper and zinc products. At ₹24.10, the market cap is just ₹41 Cr, while book value is ₹19.02 per share, so I am paying 1.27 times book. That is not demanding, but a P/E of 21.39 with collapsing profits offers little margin of safety. ROCE of only 7.56% is below what I would want from an alloy maker, and debt/equity of 0.40 is manageable but not comforting when earnings are nearly zero. There is no dividend, so shareholders receive no cash while waiting for a recovery. Promoter holding of 73.56% does align interests, but high ownership does not create a moat. The Piotroski F-Score of 4/9 reinforces my concern: weak profitability, leverage and operating-efficiency signals. The PEG ratio of 0.49 looks cheap only if you believe the 43% sales growth will eventually convert into profits, but the latest quarter says that conversion is not happening yet. This is a cyclical small-cap with limited pricing power, facing margin compression. Graham would focus on the asset cushion: ₹19 of book value gives some downside support, but with zero latest-quarter profit, the company must prove it can earn acceptable returns on that book before I commit. I would keep it on the watchlist, not buy it yet.

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