Is this stock fundamentally strong? A 6-point check
Pick a company, or type in the numbers of any listed company. Six checks tell you where it looks strong and where to look closer.
Aarti Industries turns its profit into cash, borrows little, is holding its margins and is not priced far above its sector.
Look closer at its return on capital and the promoter pledge.
Figures for FY26, updated 9 Oct 2026. Pledge from the shareholding filing for June 2026.
- Return on capital (ROCE)Look closer6.9%
Better than 2 of the 23 companies covered here.
ROCE is 6.9%. That is below 15%. Check whether new plants are still filling up, or whether the business simply earns little.
What this check means - Profit turning into cashLooks strong2.8x
Better than 22 of the 23 companies covered here.
Over three years, ₹2.8 of cash came in for every ₹1 of profit. Most of the profit is real cash.
What this check means - DebtLooks strong0.83
Better than 0 of the 23 companies covered here.
Debt to equity is 0.83: ₹83 borrowed for every ₹100 of the owners' money. That is below 1.
What this check means - Margin trendLooks strong+0.3 pts
Better than 9 of the 23 companies covered here.
EBITDA margin is 14.1%, against 13.8% a year before. It is steady or rising.
What this check means - Promoter pledgeLook closer
6 of the 24 companies covered here declared a promoter pledge in the latest filing.
The promoters have declared a pledge on some of their shares. Check how many shares, and whether it is rising.
What this check means - Price against its sectorLooks strong0.8x sector
Better than 6 of the 7 companies covered here.
P/E is 39.8, against 52.6 for the middle company in its sector. It is not priced far above its peers.
What the six checks look for
Each pass mark is a common rule of thumb, not a law. A company can miss one for a good reason.
Stock check: common questions
How do you check if a stock is fundamentally strong?
Look at a few things together: how much the business earns on its capital (ROCE), whether its profit turns into cash, how much it has borrowed, whether its margins are holding, whether the promoters have pledged shares, and how its price compares with similar companies. This page runs all six for you.
How do you know if a stock is overvalued or undervalued?
One simple check is the P/E (price ÷ earnings per share) against similar companies. A P/E far above its sector means the market expects a lot of growth. It is a starting point, not an answer: fast-growing companies often deserve a higher P/E.
How do you know if a stock is worth buying?
No checklist can tell you that on its own. These six checks show whether the business looks strong and where to look closer. The decision depends on the price, your goals and how long you will hold.
Is this a buy or sell recommendation?
No. It shows what the company's own numbers say against common rules of thumb. A company can fail a check for a good reason, such as a new plant that is still filling up.
Where do the numbers come from?
For the companies covered on this site, from their annual results, exchange filings and the exchange's daily price file, dated on the page. For any other company, you type in the numbers from its annual report or Screener.