AVT Natural Products Limited

Basic Materials — Specialty Chemicals · NSE

₹100.98+₹1.23 (+1.23%)

DalalBaazaar Score

52 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

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

In simple words: Strong business and financial position, 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, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

AVT Natural Products Limited engages in the production, trading, and distribution of oleoresins, spices extract, and value-added tea and animal nutritional products in India, Europe, the United States, and internationally.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees352

Annual revenue₹711 Cr

How does it make money?

Turns over ₹711 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 352 employees supports ₹2.02 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹2.02 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?Some evidence

ROCE of 15.8% 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 ROE22.3%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +22% while net margin moved -31% 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+22%

Margin effect-31%

DalalBaazaar Score

52/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 6.9% — barely ahead of inflation
✗ Profit has declined at 5.7% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows

Quality vs. Valuation

Company Quality

52/ 100

Average

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

Valuation

62/ 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.

Historical Valuation

Current P/E

18.4x

3Y Median

21.1x

40 monthly readings · mean 20.1x · range 15.4x–26.1x

Sector Median

40.4x

median of 4 sector peers

🟢Current valuation is approximately 13% below its 3y median of 21.1x. 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 55% below the peer median of 40.4x.

vs. its own history

Fair

21.1x median over 40 months · -13%

vs. sector peers

Cheap

40.4x median of 4 peers · -55%

vs. generic bands

Fair

15x–35x

EV/EBITDA

16.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.20x 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 18.0% to 11.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 24.2% to 15.8% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 3 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 207% over 3 years, from ₹37 Cr to ₹114 Cr.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 7.0 points, from 20.4% to 13.5%.
🔴Receivables growing faster than salesFinancial
Receivables up 98% against revenue up 22% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹11 Cr in the latest year.
🟡Inventory building faster than salesFinancial
Inventory up 51% against revenue up 22% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 55% 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?

Margins are being competed away
EBITDA margin has fallen from 20.4% to 13.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 98% against revenue up 22%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Growth barely outpaces inflation
Revenue compounding at 6.9% 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 18.0% to 11.6%. 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.

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

1EBITDA margin holds above 11%✓ 13.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹11 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 5% a year✓ 6.9% CAGR
Latest reported year was 82.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 1.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 13%✓ 15.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 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

₹1,538 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

18.4x

Fair

Fairly valued against the generic band

P/B Ratio

2.75x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.5

Profitable

Profitable on a per-share basis

ROE

11.6%

Moderate

Moderate capital efficiency

ROCE

15.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.20x

Low

Conservative leverage

Revenue Growth (YoY)

82.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

155.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.89%

Modest

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

Free Cash Flow

-₹11 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

56.7x

Flat

At or above the trailing multiple — no earnings uplift is being priced in

Operating Margin

15.3%

Good

Healthy core-business profitability

Net Margin

10.2%

Good

Strong bottom-line conversion

Current Ratio

2.71

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.51

Defensive

Steadier than the market

52W Range Position

87%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

92.8 / 87.9

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

60.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹582 Cr	₹517 Cr	₹556 Cr	₹711 Cr	+6.9%
EBITDA	₹119 Cr	₹83 Cr	₹76 Cr	₹96 Cr	-7.0%
EBITDA Margin	20.4%	16.0%	13.6%	13.5%	—
PAT (Net Profit)	₹77 Cr	₹53 Cr	₹48 Cr	₹65 Cr	-5.7%
EPS	₹5.08	₹3.5	₹3.17	₹4.26	-5.7%
ROE	18.0%	11.3%	9.5%	11.6%	—
ROCE	24.2%	15.7%	13.6%	15.8%	—
Total Debt	₹37 Cr	₹43 Cr	₹113 Cr	₹114 Cr	+45.3%
Free Cash Flow	₹43 Cr	₹86 Cr	-₹42 Cr	-₹11 Cr	—

🟢 Revenue has grown at 6.9% a year over 3 years.

🔴 EBITDA has shrunk at 7.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 20.4% to 13.5% over 3 years (-7.0 pts).

🔴 PAT (Net Profit) has shrunk at 5.7% a year over 3 years.

🔴 EPS has shrunk at 5.7% a year over 3 years.

🔴 ROE has fallen from 18.0% to 11.6% over 3 years (-6.4 pts).

🔴 ROCE has fallen from 24.2% to 15.8% over 3 years (-8.4 pts).

🔴 Total Debt has grown at 45.3% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹43 Cr to -₹11 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹845 Cr

Total Liabilities

₹286 Cr

Cash & Equivalents

₹31 Cr

Operating Cash Flow

₹12 Cr

Capex

-₹23 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.3%

Corporate Actions

Dividend Rate

₹0.9

Ex-Dividend Date

10 Aug 2026

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

3 positive3 general

AVT Natural Products Streak Near 52-Week High Continues

Univest, 16 Oct

AVT Natural Products NSE:AVTNPL Volume Spurt Clarification

Kalkine India, 12 Oct

AVT Natural Products Q1FY27 net profit up 156% to ₹311 crore

scanx.trade, 14 AugResults

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

Compare AVT NATURAL with

Equitymaster, 16 Oct

AVT Natural Products Q4 Net Profit Jumps 52% to ₹22 Cr on Robust Export Demand

Sahi, 28 MayResults

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

AVT Natural Products consolidated net profit rises 156.60% in the June 2026 quarter

Business Standard, 14 AugResults

🟢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

StrongFinancial Health

MiddlingBusiness Quality · Profitability · Valuation

WeakGrowth · Risk

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.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑