Triven.Engg.Ind. (TRIVENI)

FairStock Score: 26/100 — RISKY

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

Key Financials

Strengths

• Sales growth of 19.58% and profit growth of 34.44% show strong recent momentum.
• Promoter holding of 60.98% aligns owner interests with minority shareholders.
• Piotroski F-Score of 7/9 points to decent financial health.
• Debt/Equity of 0.64 is manageable, and latest quarter shows net profit of ₹78 Cr.
• Altman Z-Score of 2.66 suggests the balance sheet is not under immediate distress.

Concerns

• Free cash flow is deeply negative at ₹-425 Cr despite reported profits, raising earnings quality concerns.
• Valuation is rich: P/E 27.56, P/B 2.95, EV/EBITDA 280.42, with Graham Number at ₹202.24 implying negative margin of safety.
• ROE of 9.56% and ROCE of 8.65% are low relative to a P/B of 2.95, indicating weak value creation per rupee of equity.
• Sugar is a cyclical commodity business, and PEG of 2.45 suggests the market is already paying up for current growth that may not persist.

AI Analysis

Let me apply the same standards I'd use before putting a rupee to work. Triveni Engg. Ind. is in sugar, a commodity business where the supplier rarely has lasting pricing power. Last quarter it earned ₹78 Cr on ₹1,478 Cr of sales, roughly a 5.3% net margin, while full-year ROE is only 9.56% and ROCE is 8.65%. As Graham would ask: is the price justified by durable earnings? At ₹419.90, the stock trades at 27.56 times earnings and 2.95 times book value. The book value is ₹142.13, so the market is asking nearly three times book for a business earning less than ten percent on that book. The Graham Number comes to ₹202.24, meaning at today's price I have a negative margin of safety, not a margin. Yes, recent growth is strong—sales up 19.58% and profit up 34.44%—but sugar profits are notoriously cyclical. A PEG of 2.45 suggests this growth is already fully priced in. More troubling is free cash flow: negative ₹425 crore. The company is reporting profits while cash is flowing out. The Altman Z-Score of 2.66 is in a grey zone, and an EV/EBITDA of 280.42 makes any earnings-based valuation meaningless at this point. Promoter holding of 60.98% is reassuring, and a Piotroski score of 7/9 suggests balance-sheet discipline. Debt-to-equity of 0.64 is acceptable. But in my circle, buying a commodity cyclical at a rich multiple with negative cash conversion fails the test. I prefer a wonderful business at a fair price; here I see an ordinary business at what appears to be a very demanding price. I'd keep it on the watchlist, not in the portfolio.

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