Acknit Industries Limited

Consumer Cyclical — Footwear & Accessories · BSE

₹300.60−₹9.35 (−3.02%)

DalalBaazaar Score

45 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

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

What does this company do?

Acknit Industries Limited manufactures and sells industrial gloves and garments in India. It operates through four segments: Industrial Hand Gloves, Garments, Power Generation, and Other & Traded Items.

IndustryFootwear & Accessories

SectorConsumer Cyclical

Employees131

Annual revenue₹234 Cr

How does it make money?

Turns over ₹234 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹8 left at the operating level before interest, tax and depreciation. Each of its 131 employees supports ₹1.78 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.78 Cr

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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 13.2% 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 ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +2% while net margin moved -11% 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+2%

Margin effect-11%

DalalBaazaar Score

45/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 0.6% — barely ahead of inflation
✗ Profit has declined at 3.2% a year

Quality vs. Valuation

Company Quality

37/ 100

Weak

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

Valuation

77/ 100

Cheap

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

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

10.6x

3Y Median

9.7x

40 monthly readings · mean 9.7x · range 7.2x–12.3x

Sector Median

69.2x

median of 4 sector peers

🟡Currently trading close to its 3y median of 9.7x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 85% below the peer median of 69.2x.

vs. its own history

Fair

9.7x median over 40 months · +9%

vs. sector peers

Cheap

69.2x median of 4 peers · -85%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

9.1x

PEG

0.38

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 12.8% to 8.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 19.8% to 13.2% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 64% over 3 years, from ₹43 Cr to ₹71 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 69% against revenue up 2% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹8 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 85% 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 4.0x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Growth barely outpaces inflation
Revenue compounding at 0.6% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Returns on shareholder capital are falling
ROE has dropped from 12.8% to 8.6%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

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

1EBITDA margin holds above 6%✓ 7.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.0x
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✗ -₹8 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✓ 4.0x
How much operating profit can fall before interest stops being comfortably covered.
5Revenue growth stays above 4% a year✗ 0.6% CAGR
Latest reported year was 12.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.

Investment Checklist

6 / 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

5 good · 5 neutral · 1 weak

Market Cap

₹91 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.6x

Cheap

Cheap against the generic band

P/B Ratio

0.96x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹28.48

Profitable

Profitable on a per-share basis

ROE

8.6%

Moderate

Moderate capital efficiency

ROCE

13.2%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.74x

Moderate

Moderate leverage

Revenue Growth (YoY)

12.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

27.6%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.50%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹8 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

6.4%

Average

Average margins

Net Margin

3.5%

Average

Average bottom-line conversion

Current Ratio

1.71

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.06

Defensive

Steadier than the market

52W Range Position

57%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

313.0 / 320.3

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

35.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹229 Cr	₹221 Cr	₹231 Cr	₹234 Cr	+0.6%
EBITDA	₹18 Cr	₹17 Cr	₹18 Cr	₹18 Cr	-0.2%
EBITDA Margin	7.8%	7.6%	7.9%	7.6%	—
PAT (Net Profit)	₹9 Cr	₹9 Cr	₹9 Cr	₹8 Cr	-3.2%
EPS	₹29.67	₹28.13	₹29.59	₹26.92	-3.2%
ROE	12.8%	10.9%	10.3%	8.6%	—
ROCE	19.8%	16.6%	16.4%	13.2%	—
Total Debt	₹43 Cr	₹59 Cr	₹59 Cr	₹71 Cr	+18.0%
Free Cash Flow	₹22 Cr	-₹13 Cr	₹3 Cr	-₹8 Cr	—

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

🟡 EBITDA has been broadly flat over 3 years (-0.2% a year).

🟡 EBITDA Margin has held roughly flat at 7.6% over 3 years.

🔴 PAT (Net Profit) has shrunk at 3.2% a year over 3 years.

🔴 EPS has shrunk at 3.2% a year over 3 years.

🔴 ROE has fallen from 12.8% to 8.6% over 3 years (-4.2 pts).

🔴 ROCE has fallen from 19.8% to 13.2% over 3 years (-6.6 pts).

🔴 Total Debt has grown at 18.0% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹22 Cr to -₹8 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹188 Cr

Total Liabilities

₹93 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹5 Cr

Capex

-₹13 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

73.8%

Corporate Actions

Dividend Rate

₹1.5

Ex-Dividend Date

09 Sept 2026

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

2 mixed4 general

Acknit Industries Inaugurates New Factory Unit in West Bengal

scanx.trade, 23 Feb

Acknit Industries Reports Q3FY26 Results with Net Profit of ₹145.55 Lakhs

scanx.trade, 11 FebResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Acknit Industries Ltd

Equitypandit, 29 Aug

ACKNIT INDUSTRIES LTD. Share Price

Upstox, 20 Mar

Acknit Industries Ltd. Peer Comparison – Compare with Others

Value Research, 31 Aug

Acknit Industries Limited Announces Postal Ballot Results with Both Resolutions Passed

scanx.trade, 18 DecResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongValuation

MiddlingFinancial Health · Risk

WeakBusiness Quality · Growth · Profitability

Points for each in the Score ↑

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 2 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Revenue growth stays above 4% a year · see Key things to watch ↑