Bhatia Communications & Retail (India) Limited

Technology — Electronics & Computer Distribution · BSE

₹38.58−₹0.11 (−0.28%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:27 pm

Understanding the Business

Company site ↗

The 60-second version of Bhatia Communications & Retail (India) Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Bhatia Communications & Retail (India) Limited engages in retail and wholesale distribution of mobile handsets, tablets, data-cards, mobile accessories, and mobile related products in India.

IndustryElectronics & Computer Distribution

SectorTechnology

Employees171

Annual revenue₹591 Cr

How does it make money?

Turns over ₹591 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹5 left at the operating level before interest, tax and depreciation. Each of its 171 employees supports ₹3.46 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.46 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO LTD. 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 13.5% 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 ROE32.0%

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 +73% while net margin moved +14% 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+73%

Margin effect+14%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

• ROCE of 13.5% is adequate but not distinctive
✗ ROCE has fallen by 5.6 points — returns are eroding
✗ EBITDA margin of 4.6% is thin — little cushion if costs rise
✗ Net margin of 3.0% is slim
• Revenue has compounded at 20.0% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

59/ 100

Average

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

Valuation

49/ 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

26.6x

3Y Median

29.2x

40 monthly readings · mean 28.5x · range 20.9x–49.3x

Sector Median

16.5x

median of 4 sector peers

🟡Currently trading close to its 3y median of 29.2x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 61% above the peer median of 16.5x.

vs. its own history

Fair

29.2x median over 40 months · -9%

vs. sector peers

Expensive

16.5x median of 4 peers · +61%

vs. generic bands

Fair

15x–35x

EV/EBITDA

20.2x

PEG

1.04

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 47% 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 19.1% to 13.5% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 2 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 7.63x — earnings must service borrowings before shareholders see anything.
🔴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.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹18 Cr in the latest year.
🟡Inventory building faster than salesFinancial
Inventory up 114% against revenue up 73% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 47% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
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?

Leverage amplifies any setback
Debt/Equity of 7.63x. Interest is payable whether or not the business has a good year.
A premium to the sector to defend
It trades 61% above the peer median. That premium needs a reason that persists, or it closes.
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
2 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 15% a year✓ 20.0% CAGR
Latest reported year was 70.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 3%✓ 4.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹18 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 11%✓ 13.5%
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

3 good · 6 neutral · 2 weak

Market Cap

₹543 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

26.6x

Fair

Fairly valued against the generic band

P/B Ratio

4.09x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹1.45

Profitable

Profitable on a per-share basis

ROE

12.6%

Moderate

Moderate capital efficiency

ROCE

13.5%

Moderate

Moderate return on the capital in the business

Debt/Equity

7.63x

High

High leverage

Revenue Growth (YoY)

70.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

92.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.10%

Modest

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

Free Cash Flow

-₹18 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

4.7%

Weak

Thin margins leave little room for error

Net Margin

3.0%

Weak

Very little revenue reaches the bottom line

Current Ratio

6.67

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.23

Defensive

Steadier than the market

52W Range Position

86%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

38.9 / 33.6

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

50.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹342 Cr	₹414 Cr	₹443 Cr	₹591 Cr	+20.0%
EBITDA	₹13 Cr	₹18 Cr	₹21 Cr	₹27 Cr	+27.1%
EBITDA Margin	3.8%	4.3%	4.7%	4.6%	—
PAT (Net Profit)	₹8 Cr	₹12 Cr	₹14 Cr	₹17 Cr	+25.5%
EPS	₹0.68	₹0.92	₹0.98	₹1.31	+24.6%
ROE	15.6%	17.4%	15.6%	12.6%	—
ROCE	19.1%	19.9%	17.3%	13.5%	—
Total Debt	₹19 Cr	₹21 Cr	₹8 Cr	₹10 Cr	-18.9%
Free Cash Flow	₹6 Cr	₹2 Cr	₹1 Cr	-₹18 Cr	—

🟢 Revenue has grown at 20.0% a year over 3 years.

🟢 EBITDA has grown at 27.1% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 4.6% over 3 years.

🟢 PAT (Net Profit) has grown at 25.5% a year over 3 years.

🟢 EPS has grown at 24.6% a year over 3 years.

🔴 ROE has fallen from 15.6% to 12.6% over 3 years (-2.9 pts).

🔴 ROCE has fallen from 19.1% to 13.5% over 3 years (-5.6 pts).

🟢 Total Debt has shrunk at 18.9% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹6 Cr to -₹18 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹199 Cr

Total Liabilities

₹66 Cr

Cash & Equivalents

₹9 Cr

Operating Cash Flow

₹2 Cr

Capex

-₹19 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

76.6%

Corporate Actions

Dividend Rate

₹0.04

Ex-Dividend Date

21 Aug 2026

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

1 positive3 mixed2 general

Bhatia Communications & Retail (India) Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 27 Aug

Bhatia Communications Q1: Profit Doubles, 363 Stores, Maharashtra Push

Kalkine India, 12 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Bhatia Communications & Retail (India) Ltd. (BHATIA) Share Price Rises 10.06% Today

Univest, 18 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.

Bhatia Communications & Retail (India) standalone net profit rises 90.50% 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.

Bhatia Communications And Retail (India) Share Price Jumps 6% Despite Stock Market Crash

Samco, 12 MarPrice 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.

Small-cap stock under ₹50 shows resilience against stock market crash. Do you own?

Livemint, 12 Mar

Watch Items

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

DalalBaazaar Thesis

StrongGrowth

MiddlingFinancial Health · Valuation

WeakBusiness Quality · Profitability · 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. 2 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 ↑