AKI India Limited

Consumer Cyclical — Footwear & Accessories · NSE

₹5.75−₹0.11 (−1.88%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by 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, 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, 7:03 pm

Understanding the Business

Company site ↗

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

What does this company do?

AKI India Limited manufactures and trades leather and leather goods in India. It also exports its products. The company was formerly known as AKI India Private Limited and changed its name to AKI India Limited.

IndustryFootwear & Accessories

SectorConsumer Cyclical

Annual revenue₹107 Cr

How does it make money?

Turns over ₹107 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹6 left at the operating level before interest, tax and depreciation.

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 4.4% 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 ROE25.9%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +52% while net margin moved +10% 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+52%

Margin effect+10%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROCE of 4.4% is below 10% — capital is not working hard
✗ ROCE has fallen by 8.1 points — returns are eroding
✗ EBITDA margin of 6.1% is thin — little cushion if costs rise
✗ Net margin of 2.6% is slim
• Revenue has compounded at 15.0% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

50/ 100

Average

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

Valuation

76/ 100

Cheap

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

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

19.8x

3Y Median

55.9x

40 monthly readings · mean 81.9x · range 20.6x–200.0x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 65% below its 3y median of 55.9x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 71% below the peer median of 69.2x.

vs. its own history

Cheap

55.9x median over 40 months · -65%

vs. sector peers

Cheap

69.2x median of 4 peers · -71%

vs. generic bands

Fair

15x–35x

EV/EBITDA

12.5x

PEG

1.06

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.21x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 7.7% to 1.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 12.6% to 4.4% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Inventory building faster than salesFinancial
Inventory up 162% against revenue up 52% — stock may not be moving.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 54% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 65% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 71% 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 4.1x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 7.7% to 1.9%. 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
3 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

1Revenue growth stays above 11% a year✓ 15.0% CAGR
Latest reported year was 64.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 4%✓ 6.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 4.1x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹21 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 2.4x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

7 / 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 · 3 neutral · 3 weak

Market Cap

₹59 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.8x

Fair

Fairly valued against the generic band

P/B Ratio

0.75x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.29

Profitable

Profitable on a per-share basis

ROE

1.9%

Weak

Weak capital efficiency

ROCE

4.4%

Weak

Low return on total capital employed

Debt/Equity

0.21x

Low

Conservative leverage

Revenue Growth (YoY)

64.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

150.0%

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

-₹21 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

4.4%

Weak

Thin margins leave little room for error

Net Margin

2.6%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.24

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.08

Defensive

Steadier than the market

52W Range Position

39%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

6.2 / 5.5

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

12.7

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹70 Cr	₹70 Cr	₹78 Cr	₹107 Cr	+15.0%
EBITDA	₹5 Cr	₹5 Cr	₹5 Cr	₹7 Cr	+13.0%
EBITDA Margin	6.4%	6.9%	6.8%	6.1%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹2 Cr	₹2 Cr	+18.7%
EPS	₹0.15	₹0.16	₹0.19	₹0.19	+9.2%
ROE	7.7%	2.3%	2.6%	1.9%	—
ROCE	12.6%	5.8%	6.3%	4.4%	—
Total Debt	₹30 Cr	₹22 Cr	₹22 Cr	₹27 Cr	-3.1%
Free Cash Flow	-₹3 Cr	-₹23 Cr	-₹5 Cr	-₹21 Cr	—

🟢 Revenue has grown at 15.0% a year over 3 years.

🟢 EBITDA has grown at 13.0% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 6.1% over 3 years.

🟢 PAT (Net Profit) has grown at 18.7% a year over 3 years.

🟢 EPS has grown at 9.2% a year over 3 years.

🔴 ROE has fallen from 7.7% to 1.9% over 3 years (-5.8 pts).

🔴 ROCE has fallen from 12.6% to 4.4% over 3 years (-8.1 pts).

🟢 Total Debt has shrunk at 3.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹160 Cr

Total Liabilities

₹60 Cr

Cash & Equivalents

₹5 Cr

Operating Cash Flow

-₹16 Cr

Capex

-₹5 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

61.5%

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

1 mixed5 general

AKI India Share Price Forecast: 3 Year Outlook to 2030

Univest, 10 Jul

AKI India Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 02 Sept

AKI India (NSE:AKI) May Have Issues Allocating Its Capital

Simply Wall Street, 11 Feb

AKI India NSE:AKI Price Movement Clarification Sep 2026

Kalkine India, 07 Sept

Penny stock under 10 rupees: Upper circuit — Leather share jumps 74% in 4 sessions | Back-to-back surge for third day

Livemint, 04 SeptPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Volume shocker stocks: Why share price of EMS, Expleo Solutions, Windlas Biotech, AKI India, Heritage Foods are up today

TradingView, 02 Sept

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongGrowth · Valuation

MiddlingFinancial Health · Risk

WeakBusiness Quality · Profitability

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 3 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; Interest cover stays above 3x · see Key things to watch ↑