Savita Oil Tech (SOTL)
CyclicalFairStock Score: 52/100 — MIXED
Score breakdown: P/E: 2/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹699.15 |
| Market Cap | ₹4,793.4 Cr |
| P/E Ratio | 11.59 |
| ROCE | 9.84% |
| ROE | 10.95% |
| Dividend Yield | 0.73% |
| Profit Growth | 395.55% |
| Debt/Equity | 0 |
| Sales Growth | 49.18% |
| Promoter Holding | 68.91% |
| 52-Week Range | ₹285.8 — ₹844 |
| Sector | Petroleum Products |
| Book Value | ₹264.9 |
Strengths
- P/E of 14.60 and P/B of 1.51 are reasonable, especially with book value at ₹242.52.
- Promoter holding of 68.91% aligns management with minority shareholders.
- Piotroski F-Score of 7/9 suggests reported financials are relatively sound.
- Sales growth of 13.56% shows the underlying business is expanding.
Concerns
- ROE of 10.95% and ROCE of 9.84% do not indicate a strong economic moat.
- Profit growth of 170.19% against sales growth of 13.56% is margin-driven and likely unsustainable.
- Latest quarter net margin is thin at about 3.8% (₹41 Cr profit on ₹1,074 Cr sales).
- Price has fallen sharply from ₹814.80 to ₹367.30, which can signal a value trap.
AI Analysis
At ₹367.30, Savita Oil Tech has a market cap of ₹2,599 crore and trades at 14.6 times earnings and 1.51 times book value. The book value of ₹242.52 gives me some downside comfort, but I must be careful. The 170.19% profit growth looks impressive until I notice sales grew only 13.56%. That tells me the earnings jump came from margin expansion, not durable volume growth. In a lubricant business tied to crude oil and economic activity, that is cyclicality, not a wonderful franchise. The latest quarter's net profit of ₹41 crore on revenue of ₹1,074 crore is a thin 3.8% margin. Any adverse move in input costs could squeeze that quickly. Return on equity of 10.95% and ROCE of 9.84% are decent, but they don't signal a wide moat. This is not a remarkable business at a fair price; it is an average business at a lower price. The Piotroski F-Score of 7/9 gives me some comfort that the reported numbers aren't purely cosmetic, and promoter holding of 68.91% aligns their interests with mine. The debt-equity figure is not available, so I won't pretend the balance sheet is a proven strength. The stock has fallen from ₹814.80 to ₹367.30, so Mr. Market has turned unfriendly. The FairStock Score of 49/100 reinforces the mixed picture. The low P/E and the tiny PEG of 0.16 look tempting, but a value investor should remember that cyclical earnings can look cheap for a reason. I would need several quarters of stable margins and honest profit growth before treating this as a long-term holding.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer