Shanti Overseas (SHANTI)

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

Key Financials

Strengths

• P/B of 0.70 provides a margin of safety if stated book value is reliable.
• Low debt/equity of 0.38 limits financial distress risk.
• Piotroski F-Score of 5/9 indicates some positive financial signals.
• Latest quarter net profit of ₹2 Cr, if recurring, makes P/E of 3.95 very low.

Concerns

• Promoter holding is 0.00%, meaning no insider capital at risk.
• Sales collapsed by 94.23%; core edible-oil business is barely generating revenue.
• ROCE of -25.29% shows the operating business is destroying value.
• Earnings quality is questionable: quarterly net profit of ₹2 Cr vs sales of ₹1 Cr suggests non-operating income.

AI Analysis

At ₹7.43 per share with a book value of ₹10.56, Shanti Overseas appears to offer a 30% margin of safety. A P/B of 0.70 and a market cap of just ₹8 crore are precisely the kind of numbers that catch my eye in an unloved part of the market. But I have learned that a cheap price tag can hide a broken business. Sales are down 94.23%. The latest quarter shows revenue of ₹1 crore, yet the company reported a net profit of ₹2 crore. In what normal edible-oil business does profit exceed entire sales? That tells me the 'profit' may be from extraordinary items, not operations. Return on capital employed is -25.29%, so the core business is destroying value. The P/E of 3.95 and PEG of 0.02 are meaningless if earnings are not repeatable. On the positive side, debt/equity is only 0.38, so the company is not drowning in leverage, and the Piotroski score of 5 out of 9 is mediocre rather than terrible. But the single loudest warning is promoter holding of 0.00%. The people who run the company own nothing. In Graham's framework, management integrity and incentives matter as much as balance sheet. A stock can look cheap on paper and still be expensive after you account for governance risk and business decline. When I see negative ROCE, collapsed revenue, and no insider ownership, I do not rationalize the low valuation with hope. I move on. Shanti Overseas may own some assets, but it lacks a going concern in edible oils that I can trust. I would rather miss a speculative bounce than risk permanent capital in a company with this combination of red flags. For now, I classify it as an asset play only in the sense that book value exceeds price; the quality of those assets and the honesty of reported earnings remain unproven.

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