3B Films Limited

Basic Materials — Specialty Chemicals · BSE

₹14.50−₹0.10 (−0.68%)

DalalBaazaar Score

43 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:58 pm

Understanding the Business

Company site ↗

The 60-second version of 3B Films Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

3B Films Limited engages in the manufacturing and supply of cast polypropylene (CPP) and cast polyethylene (CPE) films in India.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees59

Annual revenue₹60 Cr

How does it make money?

Turns over ₹60 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 59 employees supports ₹1.02 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.02 Cr

Who are its competitors?

The closest listed comparisons in its industry are ASIAN PAINTS LIMITED, PIDILITE INDUSTRIES LTD, SRF LTD, UPL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 5.4% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE22.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -16% while net margin moved +140% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect-16%

Margin effect+140%

DalalBaazaar Score

43/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

42/ 100

Weak

How good the business is, ignoring the share price entirely.

Valuation

64/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

19.6x

2Y Median

10.8x

18 monthly readings · mean 11.3x · range 6.1x–21.5x

Sector Median

40.4x

median of 4 sector peers

⚠️Current valuation is approximately 81% above its 2y median of 10.8x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 51% below the peer median of 40.4x.

vs. its own history

Expensive

10.8x median over 18 months · +81%

vs. sector peers

Cheap

40.4x median of 4 peers · -51%

vs. generic bands

Fair

15x–35x

EV/EBITDA

10.7x

PEG

0.75

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 14.6% to 21.2% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 8.1% to 5.4% — often a sign of competition or overexpansion.

Red Flags

6 items require attention · 3 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 1.89x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.4x — little room if earnings dip.
🔴Receivables growing faster than salesFinancial
Receivables up 671% against revenue up -16% — sales are being booked faster than they are collected.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.1x to 1.4x.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹9 Cr in the latest year.
🟡Inventory building faster than salesFinancial
Inventory up 32% against revenue up -16% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 14.6% to 21.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 51% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 7.9x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Sales are being booked faster than collected
Receivables are up 671% against revenue up -16%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 81% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 19%✓ 21.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 7.9x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹9 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ 1.4x
How much operating profit can fall before interest stops being comfortably covered.
5ROCE stays above 8%✗ 5.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✗ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

3 good · 3 neutral · 5 weak

Market Cap

₹36 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.6x

Fair

Fairly valued against the generic band

P/B Ratio

0.68x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.74

Profitable

Profitable on a per-share basis

ROE

4.2%

Weak

Weak capital efficiency

ROCE

5.4%

Weak

Low return on total capital employed

Debt/Equity

1.89x

High

High leverage

Revenue Growth (YoY)

-39.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

40.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹13 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

1.9%

Weak

Assets generate little profit

Operating Margin

13.4%

Average

Average margins

Net Margin

3.1%

Average

Average bottom-line conversion

Current Ratio

1.66

Comfortable

Healthy short-term liquidity

52W Range Position

15%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

13.9 / 13.6

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

47.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹72 Cr	₹76 Cr	₹85 Cr	₹60 Cr	-5.8%
EBITDA	₹10 Cr	₹15 Cr	₹16 Cr	₹13 Cr	+6.7%
EBITDA Margin	14.6%	19.9%	18.8%	21.2%	—
PAT (Net Profit)	₹1 Cr	₹4 Cr	₹5 Cr	₹2 Cr	+26.2%
EPS	₹0.37	₹1.73	₹2.04	—	—
ROE	3.4%	13.9%	14.3%	3.5%	—
ROCE	8.1%	11.6%	10.8%	5.4%	—
Total Debt	₹99 Cr	₹107 Cr	₹102 Cr	₹100 Cr	+0.6%
Free Cash Flow	₹2 Cr	-₹1 Cr	₹9 Cr	-₹9 Cr	—

🔴 Revenue has shrunk at 5.8% a year over 3 years.

🟢 EBITDA has grown at 6.7% a year over 3 years.

🟢 EBITDA Margin has risen from 14.6% to 21.2% over 3 years (+6.6 pts).

🟢 PAT (Net Profit) has grown at 26.2% a year over 3 years.

🟡 ROE has held roughly flat at 3.5% over 3 years.

🔴 ROCE has fallen from 8.1% to 5.4% over 3 years (-2.7 pts).

🟡 Total Debt has been broadly flat over 3 years (0.6% a year).

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹9 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹180 Cr

Total Liabilities

₹127 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹2 Cr

Capex

-₹7 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

67.5%

Peer Comparison

Company	P/E	ROE
ASIAN PAINTS LIMITED	46.9x	22.3%
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

1 positive1 negative4 general

3B FILMS LIMITED Share Price

Upstox, 05 May

3B Films secures approval for ₹100 Crore rights issue to bolster capital

Sahi, 02 Jul

3B Films FY26 profit falls 63.5% as revenue declines

scanx.trade, 17 JulResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

3B Films Ltd Peer Comparison – Compare with Others

Value Research, 04 Sept

Stock Below Rs 100: Packaging Company Bags Rs 20 Crore Order from 3B Films; Delivers Around 60% Return Since Listing

Dalal Street Investment Journal, 30 JunOrder win

🟢Potentially positiveAn order or contract win, which adds to future revenue. How much depends on its size against annual sales and on when it is executed.

EMMBI INDUSTRIES Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 15 Oct

Watch Items

Revenue growth is negative (-39.8%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

MiddlingBusiness Quality · Growth · Valuation

WeakFinancial Health · Profitability · Risk

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 3 high-severity red flags sit above this conclusion and should be read first.

4 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑