Sundaram Clayton (SUNCLAY)
CyclicalFairStock Score: 9/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹1,249.9 |
| Market Cap | ₹2,755.55 Cr |
| P/E Ratio | 10.99 |
| ROCE | -2.39% |
| ROE | 32.14% |
| Dividend Yield | 0.36% |
| Profit Growth | 0.18% |
| Debt/Equity | 1 |
| Sales Growth | 18.89% |
| Promoter Holding | 59.09% |
| 52-Week Range | ₹1,112.8 — ₹1,942 |
| Sector | Auto Components |
| Book Value | ₹587.59 |
Strengths
- Promoter holding of 59.09% shows significant skin in the game.
- Book value of ₹380.73 provides some tangible asset cushion, though not at the current price.
- The reported past ROE of 32.14% suggests earning power in more normal conditions.
- Latest quarter sales of ₹501 Cr indicate a sizeable business with scope for operating leverage.
Concerns
- No positive earnings: P/E is 0.00 and latest quarter net profit is -₹52 Cr on sales of ₹501 Cr.
- ROCE is negative at -2.39%, meaning operations are not covering the cost of capital; debt/equity of 1.87 amplifies the risk.
- Sales growth of -5.33% and profit growth of -22.67% are both deteriorating.
- At ₹1,485.90, the stock trades at 3.90 times book value of ₹380.73, leaving no margin of safety.
AI Analysis
Let me begin by applying my usual filter: I want to buy a business that can generate consistent cash profits. Sundaram Clayton, as the data shows, does not pass this test today. The P/E of 0.00 is not a sign of cheapness; it is a sign that earnings are absent. In the latest quarter, the company delivered sales of ₹501 Cr but lost ₹52 Cr at the net level. A negative ROCE of -2.39% tells me the capital employed is not earning its keep, and with debt/equity at 1.87, the leverage makes this fragile. Sales have fallen by 5.33% and profit by 22.67%; the direction is wrong for an investor. Promoter holding is 59.09%, which is positive, but good owners cannot save a poor year. The reported ROE of 32.14% looks tempting, but I cannot trust it when the latest quarter is a loss and operating returns are negative. Book value is ₹380.73, so at ₹1,485.90 the market is asking me to pay 3.9 times book. That is not a margin-of-safety price. The dividend yield of 0.33% is tiny compensation. The Piotroski F-Score of 2/9 and FairStock Score of 0/100 are consistent with my concerns: this is a risky balance sheet right now. This may be a cyclical auto-component business that recovers when the industry turns; I wish it well. But my job is not to bet on hopeful turns with high debt and negative earnings. I will leave Sundaram Clayton for speculators, not investors.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer