Westlife Food (WESTLIFE)

FairStock Score: 10/100 — RISKY

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

Key Financials

Strengths

• Promoter holding is 56.26%, indicating strong alignment with long-term shareholders.
• Quarterly sales of ₹671 Cr provide a substantial revenue base, with sales growth still positive at 2.60%.
• Latest quarter net profit of ₹1 Cr is negligible but positive, meaning the company has not fallen into a loss.
• Book value per share of ₹32.25 provides a positive net worth base despite the high debt level.

Concerns

• Profit growth has collapsed by 63.05%, and net profit of ₹1 Cr on ₹671 Cr sales shows almost no earnings buffer.
• Debt-to-equity of 2.67 is high, making the weak profit stream particularly vulnerable to shocks.
• Return on equity of 3.14% and ROCE of 7.08% are far below what a 14.92 price-to-book valuation demands.
• Piotroski F-Score of 4/9 and FairStock Score of 0/100 signal deteriorating financial health and high risk.

AI Analysis

Let me begin with what I see: a restaurant company with quarterly sales of ₹671 crore, yet only ₹1 crore of net profit. That is an extraordinarily thin margin. Profit growth is down 63.05%, while sales growth is just 2.60%. This is not a business compounding wealth; it is a business struggling to turn revenue into earnings. I am a value investor, so I ask whether the price gives me a margin of safety. At ₹481.30, the market capitalisation is ₹7,717 crore, over 14 times book value. For that price I get a return on equity of 3.14% and a return on capital employed of 7.08%. Those are weak numbers, especially when debt-to-equity is 2.67. The balance sheet is leveraged, earnings are tiny, and the Piotroski score of 4/9 reinforces my concern about deteriorating fundamentals. Does the brand give it a moat? Restaurant brands can create customer loyalty, but a moat must show up in pricing power or capital returns. Here, sales growth is only 2.60%, and operating returns are far too low. The latest quarter's ₹1 crore profit on ₹671 crore sales tells me the moat is not protecting margins. The dividend yield of 0.15% is token, and with P/E at zero, conventional valuation is meaningless. In Graham's language, this is speculative, not investment. The FairStock Score of 0/100 labels it risky, and the numbers agree. I would need to see a clear path back to healthy profit margins, lower debt, and stronger ROCE before I could even start valuing this as a turnaround. Until then, the risk is too high and the return on offer is too low. I will leave it on the shelf.

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