Ugro Capital (UGROCAP)

FairStock Score: 40/100 — MIXED

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

Key Financials

Strengths

• Price ₹107.92 is below book value ₹126.27, giving P/B of 0.85 on stated equity.
• Sales growth of 10.17% and latest quarter revenue of ₹409 Cr show the lending engine is still running.
• ROCE of 11.05% and P/E of 13.86 leave room for improvement if profits normalize.

Concerns

• Promoter holding of only 1.70% is alarmingly low and indicates poor owner alignment.
• Profit growth of -82.99% and latest quarterly net profit of just ₹6 Cr on ₹409 Cr revenue show severe margin compression.
• Debt-to-equity of 3.75 with ROE of only 6.35% is a risky leverage equation for an NBFC.
• Piotroski F-score of 4/9 and zero dividend yield offer no cushion or signal of financial strength.

AI Analysis

Looking at Ugro Capital, my first reaction is caution. This is an NBFC, so the balance sheet is the business. The balance sheet shows a debt-to-equity of 3.75 and return on equity of just 6.35%. That combination is not attractive: high leverage should magnify returns, but equity here is earning a weak return. The latest quarter makes the pain visible: ₹409 crore of sales produced just ₹6 crore of net profit. That is a thin margin, and the year-on-year profit decline of 82.99% confirms serious deterioration. A P/E of 13.86 may look reasonable, but I do not pay a multiple for depressed earnings without evidence of recovery. The stock trades at ₹107.92, below book value of ₹126.27, a price-to-book of 0.85. Graham liked a margin of safety, but book value in a leveraged lender can disappear when loans go bad. With a Piotroski F-score of 4/9, financial health is shaky. There is no dividend, so the only return depends on price recovery. More troubling, promoter holding is just 1.70%. I want owners with skin in the game; this is almost an orphan. On the positive side, sales are still growing 10.17%, and ROCE of 11.05% suggests the operating capital is not idle. The franchise may be lending, but profitability has collapsed. This is a potential turnaround or a value trap; the numbers do not yet tell me which. I would wait for higher margins, stable earnings, and meaningful promoter ownership before deploying capital. In Buffett's terms, this is in the too-hard pile for now.

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