AVSL Industries Limited

Sector n/a · NSE

₹202.85₹0.00 (0.00%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by moderate debt load, 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. The direction of profits 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

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

How does it make money?

Turns over ₹150 Cr a year. Of every ₹100 of sales, about ₹1 reaches shareholders as profit, with ₹7 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?Little sign of one

Returns on capital of 14.6% 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.

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +48% while net margin moved +181% 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+48%

Margin effect+181%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

54/ 100

Average

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

Valuation

60/ 100

Fair

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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

14.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 4.4% to 6.7% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from 1.5% to 5.3%.
Return on capital is rising
ROCE has improved from 7.7% to 14.6%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

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

Red Flags

1 item require attention · 1 high

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.9x — little room if earnings dip.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 4.4% to 6.7%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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.
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

1Revenue growth stays above 11% a year✓ 14.0% CAGR
Latest reported year was 7.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 5%✓ 6.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / 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.
4Interest cover stays above 3x✗ 1.9x
How much operating profit can fall before interest stops being comfortably covered.
5Free cash flow remains positive✓ ₹3 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

3 / 9 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
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

1 good · 8 neutral · 2 weak

Market Cap

₹108 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

5.3%

Weak

Weak capital efficiency

ROCE

14.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

1.01x

Moderate

Moderate leverage

Revenue Growth (YoY)

7.9%

Modest

Modest growth

Profit Growth (YoY)

-15.8%

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

₹3 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Gross Margin

19.8%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

1.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.10

Adequate

Adequate, but no real cushion

Technical Snapshot

SMA 20 / SMA 50

119.7 / 119.7

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

100.0

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹101 Cr	₹137 Cr	₹139 Cr	₹150 Cr	+14.0%
EBITDA	₹4 Cr	₹8 Cr	₹10 Cr	₹10 Cr	+30.6%
EBITDA Margin	4.4%	5.8%	7.0%	6.7%	—
PAT (Net Profit)	₹1 Cr	₹2 Cr	₹3 Cr	₹2 Cr	+60.9%
EPS	₹0.96	₹4.21	₹4.74	—	—
ROE	1.5%	6.4%	6.7%	5.3%	—
ROCE	7.7%	16.7%	17.1%	14.6%	—
Total Debt	₹34 Cr	₹35 Cr	₹40 Cr	₹40 Cr	+5.4%
Free Cash Flow	-₹11 Cr	₹2 Cr	-₹1 Cr	₹3 Cr	—

🟢 Revenue has grown at 14.0% a year over 3 years.

🟢 EBITDA has grown at 30.6% a year over 3 years.

🟢 EBITDA Margin has risen from 4.4% to 6.7% over 3 years (+2.2 pts).

🟢 PAT (Net Profit) has grown at 60.9% a year over 3 years.

🟢 ROE has risen from 1.5% to 5.3% over 3 years (+3.8 pts).

🟢 ROCE has risen from 7.7% to 14.6% over 3 years (+7.0 pts).

🔴 Total Debt has grown at 5.4% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹11 Cr to ₹3 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹104 Cr

Total Liabilities

₹64 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹7 Cr

Capex

-₹4 Cr

Recent News

6 general

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Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
Sector/industry classification unavailable — verify manually for peer comparison.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

StrongGrowth

MiddlingBusiness Quality · Financial Health · Profitability · Valuation

WeakRisk

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. 1 high-severity red flag sits above this conclusion and should be read first.

2 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x · see Key things to watch ↑