Skipper (SKIPPER)

FairStock Score: 34/100 — RISKY

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

Key Financials

Strengths

• ROCE of 24.42% and ROE of 18.45% show strong capital efficiency relative to book value of ₹84.21.
• Sales growth of 20.73% and profit growth of 39.71% with PEG of 0.75 indicate growth is still reasonably valued.
• Piotroski F-Score of 7/9 suggests solid financial health and low accounting red flags.
• Promoter holding of 66.48% aligns management interests with minority shareholders.
• Debt/equity of 0.63 is manageable for a heavy electrical equipment player.

Concerns

• At ₹469.65, P/E of 22.52 and P/B of 5.58 leave minimal Graham-style margin of safety; you are paying a premium to book value.
• Dividend yield is negligible at 0.03%, so total return depends entirely on capital gains.
• Latest quarter net margin is only ~3.6% (₹50 Cr on ₹1,371 Cr), leaving earnings vulnerable to input costs and pricing pressure.
• Heavy electrical equipment is cyclical; the stock has swung between ₹327 and ₹593 in a year, and recent profit growth may not be linear.

AI Analysis

When I look at Skipper, I don't start with the stock price. I start with the business. The numbers show a well-run capital allocator: return on equity is 18.45%, and return on capital employed is even better at 24.42%. Sales have grown about 20.73%, and profits have grown almost 39.71%—so the company is converting revenue growth into faster earnings growth. A Piotroski score of 7 out of 9 tells me the financial fundamentals are sound, and debt-to-equity of 0.63 is acceptable for heavy electrical equipment. Promoters hold 66.48%, so the people running it have their own money at stake. All of these are good signs. But Benjamin Graham taught me to buy with a margin of safety. At ₹469.65, Skipper trades at 22.52 times earnings and 5.58 times book value of ₹84.21. That is not a cheap price. Dividend yield is just 0.03%, so I am not being paid to wait. The latest quarter earned ₹50 crore on sales of ₹1,371 crore—a net margin of about 3.6%. Thin margins mean a small input-cost shock or pricing pressure can hurt earnings quickly. Heavy electrical equipment is inherently cyclical, and the stock has already moved between ₹327 and ₹593 in a year. Buying near the upper end of that range gives me little protection if sentiment changes. The PEG ratio of 0.75 looks attractive, but that assumes the recent profit growth continues smoothly. In a cyclical industry, growth can be lumpy. I admire the returns and discipline, but I will not chase this price. I want either lower valuation or proof that the order cycle can support sustained high growth.

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