Wheels India (WHEELS)

FairStock Score: 35/100 — MIXED

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

Key Financials

Strengths

• Sales growth of 21.18% and profit growth of 42% show strong demand and operating leverage.
• Promoter holding of 58.31% aligns management with minority shareholders.
• P/E of 18.02 with PEG of 0.57 suggests reasonable valuation relative to growth.
• Piotroski F-Score of 7/9 points to sound financial health.
• ROE of 14.03% and ROCE of 16.14% are respectable for an auto component maker.

Concerns

• Net margin is thin at roughly 2.5% of sales in the latest quarter, leaving limited cushion.
• Stock is about 41% below its 52-week high, reflecting cyclical pressure in auto demand.
• Debt/Equity data is not available, so leverage risk is unclear.
• P/B of 2.69 and FairStock Score of 53/100 mean this is not a deep-value bargain.

AI Analysis

Wheels India is not the sort of business I would call a wide-moat fortress, but it has some Graham-like traits. The numbers show a well-managed auto component player with promoter holding at 58.31%, so interests are aligned. Sales growth of over 21% and profit growth of 42% are impressive, and the PEG ratio of 0.57 suggests the market is paying a reasonable price for that growth. Yet I must keep my hat on: this is an auto ancillary, and the cycle will turn. The stock at ₹1,061.35 is roughly 41% below its 52-week high of ₹1,808, which tells me the market already knows demand can be volatile. In the latest quarter, net profit of ₹32 Cr on sales of ₹1,280 Cr means a thin net margin of about 2.5%, leaving little room for error if input costs rise or OEMs squeeze prices. Return on equity of 14.03% is respectable, and ROCE of 16.14% covers capital costs, but with book value at ₹394.19 and P/B at 2.69, I am paying a premium to book. The F-score of 7 out of 9 suggests decent financial health, and the dividend yield of 1.28% gives a small income cushion. Debt-to-equity is not disclosed, which is a yellow flag; I need to see leverage before sizing a position. Overall, Wheels India looks like a cyclical grower with good management and reasonable valuation, but not a wonderful business in the Buffett sense. I would want a larger margin of safety, either a lower price relative to book or clearer evidence of a trough in the cycle. If demand strengthens and the balance sheet remains sound, patient investors could be rewarded. But I am not yet a buyer at this price without knowing the full debt picture.

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