Amco India Limited

Basic Materials — Specialty Chemicals · BSE

₹66.00−₹1.25 (−1.86%)

DalalBaazaar Score

41 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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

In simple words: The business is earning a fairly low return on the money invested in it, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Amco India Limited manufactures and sells PVC leather cloth and aluminum foils in India.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees79

Annual revenue₹112 Cr

How does it make money?

Turns over ₹112 Cr a year. Of every ₹100 of sales, about ₹0 reaches shareholders as profit, with ₹3 left at the operating level before interest, tax and depreciation. Each of its 79 employees supports ₹1.42 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.42 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 3.8% 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?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -24% while net margin moved -23% 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-24%

Margin effect-23%

DalalBaazaar Score

41/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 8.9% a year
✗ Profit has declined at 16.6% a year
✗ Profit fell 82.3% in the latest year

Quality vs. Valuation

Company Quality

34/ 100

Weak

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

Valuation

78/ 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

19.2x

3Y Median

40.3x

40 monthly readings · mean 38.2x · range 13.3x–83.5x

Sector Median

40.4x

median of 4 sector peers

🟢Current valuation is approximately 52% below its 3y median of 40.3x. 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 52% below the peer median of 40.4x.

vs. its own history

Cheap

40.3x median over 40 months · -52%

vs. sector peers

Cheap

40.4x median of 4 peers · -52%

vs. generic bands

Fair

15x–35x

EV/EBITDA

12.1x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 14% 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 5.8% to 3.8% — often a sign of competition or overexpansion.

Red Flags

6 items require attention · 1 high · 5 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.5x — little room if earnings dip.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 3.2x to 1.5x.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹1 Cr in the latest year.
🟡Profit is decliningFinancial
Net profit is down 42% over 3 years.
🟡Receivables growing faster than salesFinancial
Receivables up 16% against revenue up -24% — sales are being booked faster than they are collected.
🟡Inventory building faster than salesFinancial
Inventory up 32% against revenue up -24% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 52% 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 52% 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 3.9x 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 16% against revenue up -24%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
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 1%✓ 3.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 3.9x
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✗ -₹1 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ 1.5x
How much operating profit can fall before interest stops being comfortably covered.
5ROCE stays above 8%✗ 3.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

4 good · 3 neutral · 4 weak

Market Cap

₹27 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.2x

Fair

Fairly valued against the generic band

P/B Ratio

0.73x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹3.44

Profitable

Profitable on a per-share basis

ROE

0.9%

Weak

Weak capital efficiency

ROCE

3.8%

Weak

Low return on total capital employed

Debt/Equity

0.34x

Low

Conservative leverage

Revenue Growth (YoY)

23.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-82.3%

Falling

Profits are shrinking

Dividend Yield

None

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

Free Cash Flow

-₹1 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

4.6%

Weak

Thin margins leave little room for error

Net Margin

1.1%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.75

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.12

Defensive

Steadier than the market

52W Range Position

22%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

65.8 / 65.8

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

46.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹149 Cr	₹99 Cr	₹102 Cr	₹112 Cr	-8.9%
EBITDA	₹4 Cr	₹3 Cr	₹5 Cr	₹3 Cr	-2.9%
EBITDA Margin	2.4%	2.7%	5.2%	3.0%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹2 Cr	₹0 Cr	-16.6%
EPS	₹1.39	₹2.01	₹4.56	₹0.81	-16.5%
ROE	1.6%	2.3%	5.0%	0.9%	—
ROCE	5.8%	5.8%	8.3%	3.8%	—
Total Debt	₹15 Cr	₹10 Cr	₹13 Cr	₹13 Cr	-4.7%
Free Cash Flow	₹1 Cr	₹4 Cr	-₹4 Cr	-₹1 Cr	—

🔴 Revenue has shrunk at 8.9% a year over 3 years.

🔴 EBITDA has shrunk at 2.9% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 3.0% over 3 years.

🔴 PAT (Net Profit) has shrunk at 16.6% a year over 3 years.

🔴 EPS has shrunk at 16.5% a year over 3 years.

🟡 ROE has held roughly flat at 0.9% over 3 years.

🔴 ROCE has fallen from 5.8% to 3.8% over 3 years (-2.0 pts).

🟢 Total Debt has shrunk at 4.7% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹1 Cr to -₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹64 Cr

Total Liabilities

₹26 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹1 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

80.4%

Corporate Actions

Ex-Dividend Date

18 Sept 2006

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 positive5 general

Compare with AMCO INDIA

Equitymaster, 10 Oct

Amco India AGM: All resolutions pass with over 99% votes in favour

scanx.trade, 30 Sept

Amco India Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

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

Value Research, 31 Aug

Amco India sets book closure for 39th AGM; ratifies Neeraj Gupta

scanx.trade, 05 Sept

Schaeffler India consolidated net profit rises 13.47% in the June 2026 quarter

Business Standard, 23 JulResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Watch Items

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

DalalBaazaar Thesis

StrongValuation

MiddlingFinancial Health

WeakBusiness Quality · Growth · Profitability · Risk

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. 1 high-severity red flag sits 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 ↑