Sahana Systems (SAHANA)

FairStock Score: 69/100 — STEADY

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

Key Financials

Strengths

• P/E of 14.12 with 95.55% profit growth gives a PEG of 0.13, suggesting the market is not fully pricing current growth.
• ROCE of 42.14% reflects strong capital efficiency and a potentially durable competitive position.
• Latest quarter net profit of ₹28 Cr on sales of ₹114 Cr implies a healthy net margin of around 25%.
• Promoter holding of 57.31% aligns management interests with minority shareholders.
• Piotroski F-Score of 7/9 indicates decent fundamental health and earnings quality.

Concerns

• Dividend yield of just 0.10% means the return case relies entirely on continued growth and capital appreciation.
• The stock is down roughly one-third from its 52-week high of ₹1289, suggesting possible market skepticism or momentum reversal.
• Book value, ROE, and debt/equity are not available, limiting a full Graham-style assessment of balance sheet safety.
• Sales growth of 116.87% and profit growth of 95.55% are extraordinary and unlikely to persist at such extreme levels.

AI Analysis

I begin not with price, but with business quality. Sahana Systems earns an ROCE of 42.14%, a level that would make any enterprise a wonderful compounder if sustained. The latest quarter shows sales of ₹114 Cr and net profit of ₹28 Cr, implying a roughly 25% net margin, which is attractive for IT-enabled services. Promoter holding of 57.31% gives me comfort; owners remain tied to the company's fate. Piotroski F-Score of 7/9 also suggests the reported profits are not merely accounting noise. Yet I must keep Graham's caution close: rapid growth is a double-edged sword. Sales grew 116.87% and profit grew 95.55%, but such rates will inevitably moderate. At ₹861.30, the stock trades at a P/E of 14.12. With a PEG of 0.13, Mr. Market is either offering a rare bargain or, more likely, factoring in sharp deceleration. The 52-week range of ₹685 to ₹1289 shows the stock has already fallen roughly one-third from its high; that alone is not a red flag, but it reminds me that sentiment can change quickly. The dividend yield of 0.10% is negligible. I am not buying for income; I am buying for growth. Therefore, the entire thesis depends on the durability of the franchise. Since book value, ROE, and debt/equity are unavailable, I cannot assess the balance sheet as thoroughly as I would like. That forces me to demand a wider margin of safety. At a P/E of 14 with historically strong growth, the price seems reasonable, but not exceedingly cheap given the uncertainty. FairStock Score of 60/100 labels it Steady, not exceptional. I would wait for evidence that growth persists, or let the stock decline further to compensate for the missing accounting transparency.

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