Wonder Electric. (WEL)
CyclicalFairStock Score: 24/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹145.05 |
| Market Cap | ₹1,943.79 Cr |
| P/E Ratio | 213.31 |
| ROCE | 18.12% |
| ROE | 8.76% |
| Dividend Yield | 0.15% |
| Profit Growth | 264.68% |
| Debt/Equity | 1.08 |
| Sales Growth | 50.98% |
| Promoter Holding | 71.79% |
| 52-Week Range | ₹67.94 — ₹183.53 |
| Sector | Consumer Durables |
| Book Value | ₹6.68 |
Strengths
- High promoter holding of 71.79% demonstrates strong owner alignment.
- ROCE of 18.12% shows the company generated decent returns on capital before the downturn.
- Latest quarter still net positive at ₹1 Cr despite the severe profit collapse.
- ROE of 12.32% remains positive, indicating some ability to generate shareholder returns.
Concerns
- P/E of 139.39 and P/B of 15.64 are dangerously high relative to current earnings and book value of ₹6.71.
- Sales growth of -31.13% and profit growth of -88.80% show a sharp operating deterioration.
- Piotroski F-score of 3/9 signals weak financial health and rising distress risk.
- Debt/equity of 0.92 becomes risky as profits shrink and interest burden stays.
AI Analysis
As a value investor, I judge a stock by the business behind it, not the ticker. Wonder Electric sells household appliances, a competitive, low-moat industry where consumer choice and dealer power reign. The numbers, however, are alarming. Sales fell 31% and net profit collapsed by nearly 89%, leaving just ₹1 Cr profit on ₹153 Cr quarterly sales. The return on equity of 12.32% and ROCE of 18.12% look respectable, but they are trailing figures from better times. Book value is only ₹6.71, yet the market trades it at ₹104.96 – a P/B of 15.64 and a P/E of 139.39. That is not a price that offers protection; it embeds expectations of a spectacular comeback. Debt/equity of 0.92 is concerning when profits are drying up, and the Piotroski F-score of 3/9 confirms a deteriorating financial position. Promoter holding at 71.79% is the one bright spot – meaningful skin in the game – but even the most patient owners cannot change price to value. This looks like a cyclical business caught in a severe downcycle, and the market is valuing it as a growth stalwart. In Graham’s words, the margin of safety is missing. I would wait on the sidelines until earnings stabilise, debt reduces, and the price reflects the risk. There is no urgency to own a business selling at 139 times current earnings while its profits are vanishing.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer