Arvind Fashions Limited

Consumer Cyclical — Apparel Retail · NSE

₹399.90+₹1.00 (+0.25%)

DalalBaazaar Score

62 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

Driven by moderate debt load, small-cap size, which brings sharper price swings, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

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

What does this company do?

Arvind Fashions Limited engages in the wholesale and retail trading of ready-made garments and accessories in India and internationally.

IndustryApparel Retail

SectorConsumer Cyclical

Employees1,092

Annual revenue₹5,265 Cr

How does it make money?

Turns over ₹5,265 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 1,092 employees supports ₹4.82 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹4.82 Cr

Who are its competitors?

The closest listed comparisons in its industry are TRENT LTD, TITAN COMPANY LIMITED, 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?Some evidence

ROCE of 19.6% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE25.9%

What is the outlook?

8 analysts covering the stock expect revenue to grow about 13.9% and earnings to grow about 41.1% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+13.9%

Est. earnings growth+41.1%

Analysts8

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +30% while net margin moved +158% 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+30%

Margin effect+158%

DalalBaazaar Score

62/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 44.2x is demanding — it needs sustained high growth to justify
✓ P/E is 48% below its own historical median of 84.9x — cheap by its own standards
✗ P/B of 5.65x is a steep premium to book

Quality vs. Valuation

Company Quality

67/ 100

Good

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

Valuation

70/ 100

Cheap

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

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

44.2x

3Y Median

84.9x

40 monthly readings · mean 99.5x · range 42.3x–189.1x

Sector Median

69.9x

median of 3 sector peers

🟢Current valuation is approximately 48% below its 3y median of 84.9x. 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 37% below the peer median of 69.9x.

vs. its own history

Cheap

84.9x median over 40 months · -48%

vs. sector peers

Cheap

69.9x median of 3 peers · -37%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

9.5x

PEG

0.89

What's Good / What's Bad

🟢 What's Going Well2

Return on equity is rising
ROE has improved from 4.0% to 13.0%.
Return on capital is rising
ROCE has improved from 14.1% to 19.6%.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 high

🔴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.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 19.6% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Priced below its own history
The stock trades 48% 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 37% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

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
Small 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 11%✓ 13.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Interest cover stays above 3x✗ 3.0x
How much operating profit can fall before interest stops being comfortably covered.
3Revenue growth stays above 7% a year✓ 9.0% CAGR
Latest reported year was 15.5%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Free cash flow remains positive✓ ₹295 Cr
Profit that never becomes cash eventually stops being profit.
5Debt / EBITDA stays below 2x✓ 1.9x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.

Investment Checklist

6 / 12 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
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 4 neutral · 3 weak

Market Cap

₹5,348 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

44.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.65x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹9.04

Profitable

Profitable on a per-share basis

ROE

13.0%

Moderate

Moderate capital efficiency

ROCE

19.6%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.15x

Moderate

Moderate leverage

Revenue Growth (YoY)

15.5%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-23.4%

Falling

Profits are shrinking

Dividend Yield

0.40%

Modest

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

Free Cash Flow

₹295 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

22.5x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

6.3%

Average

Average margins

Net Margin

2.2%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.26

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.12

Defensive

Steadier than the market

52W Range Position

17%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

405.4 / 429.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

43.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,064 Cr	₹4,252 Cr	₹4,618 Cr	₹5,265 Cr	+9.0%
EBITDA	₹481 Cr	₹537 Cr	₹601 Cr	₹695 Cr	+13.0%
EBITDA Margin	11.8%	12.6%	13.0%	13.2%	—
PAT (Net Profit)	₹37 Cr	₹81 Cr	-₹36 Cr	₹123 Cr	+49.5%
EPS	₹2.76	₹6.05	₹-2.67	₹9.16	+49.2%
ROE	4.0%	8.0%	-3.7%	13.0%	—
ROCE	14.1%	15.1%	18.3%	19.6%	—
Total Debt	₹1,265 Cr	₹1,148 Cr	₹1,157 Cr	₹1,336 Cr	+1.8%
Free Cash Flow	₹279 Cr	₹352 Cr	₹434 Cr	₹295 Cr	+1.9%

🟢 Revenue has grown at 9.0% a year over 3 years.

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

🟢 EBITDA Margin has risen from 11.8% to 13.2% over 3 years (+1.4 pts).

🟢 PAT (Net Profit) has grown at 49.5% a year over 3 years.

🟢 EPS has grown at 49.2% a year over 3 years.

🟢 ROE has risen from 4.0% to 13.0% over 3 years (+9.0 pts).

🟢 ROCE has risen from 14.1% to 19.6% over 3 years (+5.4 pts).

🟡 Total Debt has been broadly flat over 3 years (1.8% a year).

🟡 Free Cash Flow has been broadly flat over 3 years (1.9% a year).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,216 Cr

Total Liabilities

₹3,055 Cr

Cash & Equivalents

₹51 Cr

Operating Cash Flow

₹404 Cr

Capex

-₹109 Cr

Shareholding (proxy)

Institutional Holding

29.5%

Insider Holding

37.3%

Corporate Actions

Dividend Rate

₹1.6

Ex-Dividend Date

07 Aug 2026

Analyst Consensus

Recommendations

8 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹647.5

+61.9% vs CMP

Target Range

₹530 – ₹784

Peer Comparison

Company	P/E	ROE
TRENT LTD	87.2x	25.9%
TITAN COMPANY LIMITED	68.5x	36.7%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

2 positive1 mixed3 general

Arvind Fashions Share Price - Live NSE: ARVINDFASN Stock Price & Chart

Upstox, 16 Oct

Arvind Fashions (ARVINDFASN.NS) Ticks Up 1.28% to ₹399.3, Nearing Upper Resistance Band - Hedge Fund Exposure

https://www.siam.in/, 13 Oct

Arvind Fashions Limited (NSE:ARVINDFASN) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

Simply Wall Street, 24 JulAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Arvind Fashions Q4 Results: Stock jumps after return to profitability; Revenue up 14%

CNBC TV18, 06 MayResults

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

Arvind Fashions Q1 Results: Net profit rises 11% to Rs 27.61 cr

The Economic Times, 21 JulResults

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

Buy Arvind Fashions; target of Rs 620: Motilal Oswal

Moneycontrol.com, 23 Jul

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Growth

MiddlingFinancial Health · Profitability · Risk

WeakValuation

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 5 tripwires tripped — Interest cover stays above 3x · see Key things to watch ↑