Timken India (TIMKEN)

FairStock Score: 43/100 — MIXED

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

Key Financials

Strengths

• Near-zero debt with Debt/Equity of 0.01 and a strong Piotroski F-Score of 7/9.
• High capital efficiency: ROE of 15.13% and ROCE of 20.93%.
• Financially safe: Altman Z-Score of 6.91 indicates low bankruptcy risk.
• Promoter holding of 51.05% implies aligned interests and stability.
• Latest quarter remains profitable with sales of ₹764 Cr and net profit of ₹50 Cr.

Concerns

• Extreme valuation: P/E of 60.70 and P/B of 9.52 leave virtually no margin of safety.
• Growth too slow to justify the multiple: sales growth of 5.80%, profit growth of 7.06%, PEG at 11.25.
• Graham Number of ₹697.86 implies margin of safety of -397.65%; DCF value of ₹10.34 is absurdly far from the market price.
• Free cash flow of ₹50 Cr is minuscule relative to a ₹26,123 Cr market cap; dividend yield of 1.04% offers little support.

AI Analysis

Let me be plain: this is a good business but not a good investment at ₹3,600. Timken India earns a return on equity of 15.13% and a return on capital of 20.93%, with debt-to-equity of 0.01 and an Altman-Z of 6.91. Those are the numbers of an operator with pricing power and a sound balance sheet. The Piotroski F-score of 7 out of 9 reinforces that financial health. But Graham taught me that a great company at a great price is a great investment; this is not a great price. Sales grow at just 5.80% and profit at 7.06%. At a P/E of 60.70 and P/B of 9.52, the market is paying for a future far brighter than the present. The Graham Number of ₹697.86 gives a margin of safety of negative 397.65%, and the DCF figure of ₹10.34 is so far below the market price that the valuation does not make sense. Even if the DCF is flawed, the message is consistent: no margin of safety. Free cash flow of ₹50 Cr against ₹26,123 Cr market cap means you are paying an enormous price for tiny cash generation. Dividend yield of 1.04% barely compensates for waiting. Promoter holding of 51.05% is good, and I admire the business economics. But with a PEG of 11.25, this is not a value proposition. I would keep it on my watchlist, not in my portfolio, until either earnings catch up with the price or the price falls to a level I can comfortably land on.

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