Shiva Texyarn (SHIVATEX)

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

Key Financials

Strengths

• Promoter holding at 74.04% aligns interests and shows commitment.
• Debt/equity of 0.72 is manageable, with no excessive leverage.
• ROE of 12.32% is respectable for a small-cap textile player.
• P/E of 13.21 and P/B of 1.62 are not demanding if earnings stabilize.
• Book value of ₹94.98 provides some downside support at the current price.

Concerns

• Profit growth is -8.33% and Piotroski F-score is a weak 4/9, indicating deteriorating fundamentals.
• Latest quarter profit of ₹2 Cr on sales of ₹76 Cr shows a very thin margin.
• ROCE of 9.31% with debt/equity of 0.72 suggests returns are modest and leverage is doing part of the work.
• Dividend yield of 0.38% and PEG of 8.58 mean investors are not being compensated for weak growth.

AI Analysis

At ₹154, Shiva Texyarn has a market cap of just ₹206 Cr, so I'm clearly looking at a small textile player. The first question in Omaha is always: what kind of business am I buying? Textiles are a competitive, commodity-like business where pricing power is scarce and margins are thin. The numbers reinforce this. Sales growth is only 1.54%, and profit is down 8.33%. In the latest quarter, the company earned ₹2 Cr on ₹76 Cr of sales, a thin margin that tells me the business is not gaining any pricing advantage. I do see some positive signs. A 74% promoter holding means the people running the show have skin in the game. The balance sheet is not alarming; debt-to-equity of 0.72 is manageable, and book value is ₹94.98. At a P/B of 1.62, I am paying a moderate premium to book. But a moderate price for a mediocre business is not an attractive investment. The Piotroski F-score of 4/9 is a red flag. It suggests the fundamentals are deteriorating, not improving. Return on equity is 12.32%, which is okay, but return on capital employed is only 9.31%, so leverage is boosting the equity return a bit. The PEG ratio of 8.58 tells me the market is pricing in growth that simply isn't there. Dividend yield of 0.38% means I am not being paid to wait. Graham would say buy with a margin of safety. Here the P/E is 13.21, not extreme, but the earnings are falling. The stock has traded between ₹126 and ₹217 over the past year; the current price is closer to the low, which can be a trap or an opportunity. Without evidence of margin recovery and improving capital allocation, I would put this in the 'too hard' pile. I'd rather wait for a stronger balance sheet and better fundamentals.

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