Sarda Energy (SARDAEN)

FairStock Score: 56/100 — STEADY

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

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I view Sarda Energy through a Graham-and-Buffett lens: it is an iron & steel business, inherently cyclical, so I ask whether the price compensates for commodity risk. At ₹531.15 and a market cap of ₹18,717 Cr, the stock trades at P/E 16.58 and P/B 2.54 against book value of ₹208.99. The balance sheet offers some comfort: debt/equity is only 0.35, ROE is 16.80%, ROCE 15.27%, and promoters hold 73.16%, aligning interests. The latest quarter showed ₹1,276 Cr sales and ₹190 Cr net profit, and five-year revenue CAGR of 18.35% suggests past expansion. But the recent trend is weak: sales growth is -10.52% and profit growth -17.48%. More troubling, free cash flow is -₹1,246 Cr, meaning reported profits are not converting into cash. Valuation is the rub. Graham Number is ₹346.44, so at ₹531.15 I am paying a negative margin of safety of -59.22%. PEG of 0.57 looks cheerful only if growth returns, while EV/EBITDA of 119.40 is a glaring red flag. Piotroski F-Score 6/9 is respectable, Altman Z-Score 2.88 is middling, and FairStock Score 56/100 labels it STEADY. The dividend yield is negligible at 0.38%. Steel may earn decent returns in upcycles, but it lacks a durable moat. I would not buy today; I would wait for a price closer to or below Graham Number, positive free cash flow, and evidence that sales and profit declines have reversed.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

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