Soma Textiles (SOMATEX)
TurnaroundScore breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹91.37 |
| Market Cap | ₹310.42 Cr |
| P/E Ratio | 33.59 |
| ROCE | -1.74% |
| ROE | 3.28% |
| Dividend Yield | 0.55% |
| Profit Growth | -23.97% |
| Debt/Equity | 0 |
| Sales Growth | 311.08% |
| Promoter Holding | 80.6% |
| 52-Week Range | ₹62.15 — ₹161.25 |
| Sector | Textiles & Apparels |
| Book Value | ₹50.76 |
Strengths
- Zero debt (D/E 0.00) provides balance sheet stability.
- Piotroski F-Score of 6/9 indicates decent financial health.
- Promoter holding of 80.60% aligns owner-management interests.
- Latest quarter profitable with sales ₹28 Cr and net profit ₹2 Cr.
- Large reported sales and profit growth, though from a clearly low base.
Concerns
- ROCE is negative at -1.74% and ROE is only 3.28%, showing weak capital allocation.
- P/E of 495.95 and P/B of 2.37 are far above any Graham-style margin of safety.
- No dividend yield means investors get no cash return while waiting.
- FairStock Score is N/A due to insufficient data, limiting confidence in the growth story.
AI Analysis
At ₹108.33, Soma Textiles has a market cap of ₹367 Cr, yet this is not a business I would want to own at this price. The textile industry offers little economic moat; products are commoditised and pricing power is scarce. The numbers confirm that. ROE of just 3.28% and ROCE of -1.74% tell me the company is not earning a satisfactory return on either equity or employed capital. The P/E of 495.95 and P/B of 2.37 against book value of ₹45.67 imply investors are paying a heavy premium for weak underlying profitability. The huge sales growth of 4647% and profit growth of 183% look impressive, but when the latest quarter shows sales of only ₹28 Cr and net profit of ₹2 Cr, it is clear the base was tiny. Annualised, that profit is roughly ₹8 Cr — still nowhere near justifying a ₹367 Cr valuation. A PEG of 0.21 is unreliable when the growth rate is distorted by a low base. On the positive side, debt/equity of 0.00 means no debt, the Piotroski F-Score of 6/9 is reasonable, and 80.6% promoter holding aligns interests. But zero dividend yield means shareholders rely entirely on price appreciation. In Graham's language, price is what you pay; value is what you get. Book value of ₹45.67 provides a floor, but paying 2.37 times that for a business with negative ROCE offers no margin of safety. I would watch whether ROCE turns positive and whether quarterly profits can be sustained. Until then, this is a speculation, not an investment.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer