Shanti Gold (SHANTIGOLD)

FairStock Score: 67/100 — STEADY

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

Key Financials

Strengths

• Sales grew 110.06% and net profit 127.62%, with PEG of 0.10 suggesting growth is not fully priced.
• P/E of 11.74 is reasonable for the reported growth pace.
• Financial health looks sound: debt/equity of 0.34, ROCE of 26.19%, and Piotroski F-Score of 7/9.
• Promoter holding of 74.89% aligns majority owners with minority shareholders.

Concerns

• Zero dividend yield; no income buffer for minority shareholders.
• P/B of 2.32 means paying more than twice book value, leaving limited Graham-style margin of safety.
• Extremely high growth may be cyclical or unsustainable for a jewellery business.
• ROE is not provided, so the return on shareholders' equity cannot be fully assessed.

AI Analysis

Shanti Gold passes my first filter: I can roughly understand what it does—buying and selling gold jewellery—even if the economics are not always simple. What catches my eye is the combination of astonishing growth and a modest price. Sales rose 110.06% and profits 127.62%, yet the market prices it at only 11.74 times earnings. That makes the PEG look absurdly low at 0.10. In Buffett-Graham terms, we are being asked to pay ₹209.50 for a business earning roughly ₹17-18 per share on rapidly growing sales. But a low P/E only matters if the quality is there. The balance sheet is respectable: debt/equity of 0.34 and ROCE of 26.19%. The Piotroski score is 7/9, so the underlying financials look solid, not manipulated. Promoter holding is 74.89%, which aligns owners with minority shareholders, though it leaves a small float. Still, I have to play devil's advocate. A 110% sales growth rate is not normal for a jewellery business—it may reflect a recovery, a gold-price spike, or an exceptional order flow. Graham taught me to treat temporary prosperity as suspect. There is no dividend; the yield is zero, so as a minority shareholder my return depends entirely on continued growth and capital gains. Book value is ₹90.23, so I am paying 2.32 times book—not a deep-value margin of safety. And with ROE not disclosed, I cannot fully judge how efficiently equity is being turned into profit. The latest quarter shows ₹637 Cr sales and ₹40 Cr net profit, a margin of roughly 6.3%; that is okay, but not spectacular. If these growth rates continue, Shanti Gold is cheap. If they revert to the industry mean, the current price leaves little room for error. I would wait for evidence that demand is durable, and keep a close eye on gold prices and working capital. This belongs in the 'fast grower' box, not the 'deep value' box.

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