Sportking India (SPORTKING)

FairStock Score: 57/100 — STEADY

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

Key Financials

Strengths

• Attractive valuation: P/E of 11.92 and PEG of 0.61 suggest the market is pricing in little growth
• Healthy balance sheet with debt/equity of 0.48 and Piotroski F-score of 7/9
• Profit growth of 32.97% driven by margin expansion, with latest quarter net profit of ₹25 Cr
• High promoter holding of 74.36% aligns management interests with minority shareholders
• ROE of 13.03% and ROCE of 12.04% are respectable for a capital-intensive textile business

Concerns

• Very thin net margin of under 4% in the latest quarter leaves little room for error
• Sales growth of only 5.93% means recent profit growth may not be sustainable if margins normalize
• Sharp 52-week range of ₹78.17 to ₹241.51 highlights cyclical and earnings volatility
• Low dividend yield of 0.87% offers limited income while waiting for value to be recognized

AI Analysis

At ₹135, Sportking India is not the kind of business that makes me leap across the table. Textile manufacturing is a tough, commodity-like trade with little pricing power. But the numbers deserve a second look. The stock trades at just 11.92 times earnings, and with profit growth of nearly 33%, the PEG ratio is only 0.61. That is cheap, provided the growth is real and durable. What bothers me is the source of that growth: sales rose only 5.93%, so the profit jump is coming from margin expansion, not strong underlying demand. The latest quarter shows net profit of ₹25 Cr on sales of ₹646 Cr — a net margin of under 4%. That is thin and vulnerable to input cost swings. Financially, Sportking is respectable: debt-to-equity is 0.48, the Piotroski F-score is 7 out of 9, and book value is ₹74.75 per share against a price of ₹135.29, giving a P/B of 1.81. Return on equity of 13.03% is decent but not exceptional; this is not a wide-moat franchise. Promoter holding of 74.36% is very reassuring — the people running it own most of it. The 52-week range of ₹78 to ₹241 tells me this is a cyclical stock, and today's price is well off the high. At 11.9 times earnings with moderate debt and improving profits, there is a margin of safety, but I must stay cautious. Textile profits can reverse quickly. I would want to see whether this margin expansion is a lasting improvement or just a temporary tailwind.

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