Sreeleathers (SREEL)

FairStock Score: 43/100 — MIXED

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

Key Financials

Strengths

• Trading below book value: P/B of 0.95 against book value of ₹192.89.
• Zero debt: Debt/Equity of 0.00 gives a conservative, low-risk balance sheet.
• Promoter holding of 75% aligns ownership with minority shareholders.
• Profit growth of 21.67% and Piotroski F-Score of 7/9 indicate improving fundamentals.
• Moderate sales growth of 9.89% shows steady demand traction.

Concerns

• Low ROE of 5.53% and ROCE of 7.31% suggest weak capital efficiency and limited moat.
• P/E of 19.36 is not cheap for a business earning such low returns on equity.
• Dividend yield of only 0.49% offers negligible income support.
• Price near the lower end of the 52-week range (₹165.25–₹258.00) indicates weak market sentiment.

AI Analysis

At ₹182.44, Sreeleathers sits below its book value of ₹192.89, yet this is not a classic Graham net-net or hidden bargain. A P/B below 1 catches my eye, but I must ask what the book value is actually earning. The answer: only 5.53% ROE and 7.31% ROCE. That is not the hallmark of a business with pricing power or a durable moat. In footwear, brand strength and distribution matter; I see no evidence of exceptional competitive advantage in these figures. Zero debt is good — the balance sheet is conservative, and promoter holding of 75% aligns owners with management. Piotroski F-score of 7/9 hints at improving fundamentals, and the latest quarter shows sales of ₹61 Cr and net profit of ₹8 Cr, suggesting some momentum. Sales growth of 9.89% is moderate; profit growth of 21.67% is stronger, but when return on equity is only 5.53%, I wonder how much of this growth comes from a low base or a margin blip. At a P/E of 19.36 and PEG of 1.23, the market is paying a reasonable but not cheap price for that growth. Dividend yield of 0.49% is trivial. For a Graham investor, the key discipline is margin of safety. Buying at a small discount to book with no debt provides some downside support, but a business earning 5.5% on equity is not compounding wealth at a satisfying rate. If management can deploy capital profitably and improve returns, maybe; otherwise, shareholders are just watching book value grow slowly. I would not classify this as a fast grower or a stalwart. This is more an asset play where I need to watch whether management can turn the asset base into higher returns.

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