SPL Industries (SPLIL)

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

Key Financials

Strengths

• Price-to-book of 0.48: market cap ₹87 Cr is at a significant discount to stated book value of ₹70.64 per share
• Piotroski F-Score of 6/9 indicates reasonably sound financials
• Promoter holding of 74.88% aligns ownership with minority shareholders
• Latest quarter net profit of ₹2 Cr on sales of ₹15 Cr shows some earnings power at the margin

Concerns

• Sales growth is deeply negative at -45.21%, indicating a shrinking business
• ROE of 2.93% and ROCE of 4.55% are far below what a value investor should accept
• Profit growth of 693.33% is a low-base effect and not evidence of sustainable quality
• Zero dividend yield means no cash return while waiting for a re-rating

AI Analysis

Let's look at SPL Industries. At ₹34 with a book value of ₹70.64, I am being asked to pay only 48 paise for each rupee of stated assets. That is the classic Graham bargain. But cheap assets alone are never enough. This business earns a weak ROE of 2.93% and ROCE of 4.55%. If the company cannot generate decent returns on its ₹70.64 book value, then the discount Mr. Market gives it may be fully deserved. Sales fell 45.21%, which is a serious red flag. The latest quarter shows ₹15 Cr in sales and ₹2 Cr in profit, so there is some life, but the 693% profit growth is on a low base and not evidence of durable quality. The PEG of 0.02 is meaningless here because this is not a compounding growth story. The Piotroski score of 6/9 does suggest the financial fabric has not torn, and promoter holding of 74.88% means owner interests are aligned. However, zero dividend means I am not getting paid to wait. In Graham's framework, this is an asset play, not a compounder. The margin of safety must come from the balance sheet and from management's ability to create value from the assets. If returns stay below 5%, the stock could remain cheap for a long time. I would need to see improving quarterly sales, better capital allocation, or a concrete catalyst before committing. Until then, it belongs on the watchlist, not in my portfolio.

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