Sambhv Steel (SAMBHV)

FairStock Score: 46/100 — MIXED

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

Key Financials

Strengths

• Sales growth of 59.64% and profit growth of 112.79% show strong momentum
• Low debt/equity of 0.19 and Piotroski F-Score of 7/9 indicate financial soundness
• Promoter holding of 56.15% aligns management with minority shareholders
• PEG of 0.33 suggests growth is not fully reflected in the P/E of 28.31

Concerns

• Zero dividend yield means no cash return while waiting for growth
• P/E of 28.31 and P/B of 3.60 leave little margin of safety if growth slows
• Steel is cyclical; current profit growth may reflect an up-cycle rather than a durable moat
• Latest quarterly net margin is only around 4% of sales, leaving limited cushion

AI Analysis

At ₹119.50, Sambhv Steel is not a typical Graham net-net; it trades at 28.31 times earnings and 3.60 times book value. Graham would demand a margin of safety, and at this price the market is paying for future growth. The growth is real: sales rose 59.64% and profit jumped 112.79%. The latest quarter shows ₹589 Cr sales and ₹24 Cr net profit, an annualized run-rate roughly in line with the P/E. A PEG of 0.33 suggests the earnings multiple is not excessive if the growth is durable. But steel is a cyclical commodity business, so I must ask whether this growth is a permanent improvement or just the upswing. ROCE at 13.92% is decent but not outstanding, and with no dividend, the shareholder depends entirely on continued capital gains. The balance sheet is sound: debt/equity of 0.19 and a Piotroski F-score of 7/9 give me comfort that reported earnings are not built on a weak foundation. Promoter holding of 56.15% aligns ownership with outsiders. However, I cannot call this a wonderful business with a wide moat; it is a well-run steel player riding strong demand. The FairStock Score of 45/100 is mixed, and I respect that. My discipline: I would not buy at ₹119.50 on growth alone. I would watch whether quarterly momentum continues, whether ROCE expands, and whether the company starts returning cash. If earnings keep compounding at this pace and the price stays reasonable, it could deserve a place; until then, it is a fast grower that I monitor but do not chase.

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