Tarmat (TARMAT)

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

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

Let me start with the business, not the ticker. Tarmat is a civil construction company with a market cap of ₹178 Cr. The latest quarter tells a clear story: sales of ₹27 Cr and net profit of just ₹1 Cr. That is a very thin margin. Over the full year, the P/E of 46.31 says the market is paying a high multiple for those earnings, yet ROE is only 2.26% and ROCE is only 1.55%. In other words, this company earns very little on either shareholder equity or total capital employed. That is not the hallmark of a franchise with a durable moat. Construction is also a competitive, low-margin business, and with promoter holding at 30.13%, minority owners have to rely on a management team whose ownership stake is modest. On the positive side, the balance sheet is clean: debt/equity is just 0.06, so there is no distress. And at ₹53.93, the stock trades at a 27% discount to book value of ₹73.95. Graham would be interested in that margin of safety. But a low P/B only works if assets earn a decent return; at ROE of 2.26%, the book value is not being put to productive use. The 232.35% profit growth and PEG of 0.39 look impressive, but the absolute quarterly profit is only ₹1 Cr—the base is far too small to justify a P/E of 46. This is not a compounder yet. I would classify it as an asset play, contingent on evidence that management can improve returns. Watch whether sales growth can accelerate from 4.48% and whether profit can continue at these levels. Until then, patience, not action.

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