Bright Brothers Limited

Basic Materials — Specialty Chemicals · NSE

₹208.00−₹12.40 (−5.63%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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

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, 6:10 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Bright Brothers Limited manufactures and markets injection moulded plastic products for supplying to original equipment manufacturers for consumer durables industry in India.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees350

Annual revenue₹374 Cr

How does it make money?

Turns over ₹374 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹8 left at the operating level before interest, tax and depreciation. Each of its 350 employees supports ₹1.07 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin7.6%

Net margin1.6%

Revenue / employee₹1.07 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.

ASIAN PAINTS LIMITEDP/E 46.9x · ROE 22.3%

PIDILITE INDUSTRIES LTDP/E 57.8x · ROE 24.4%

SRF LTDP/E 33.8x · ROE 15.4%

UPL LIMITEDP/E 21.5x · ROE 6.1%

What is its competitive advantage?Little sign of one

Returns on capital of 13.7% 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.

ROCE13.7%

ROE7.3%

Peer median ROE22.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +81% while net margin moved -186% 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+81%

Margin effect-186%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Debt/Equity of 1.35x is on the heavy side
• Current ratio of 1.12 covers short-term liabilities, without much slack
✗ Free cash flow is negative — growth is being funded by borrowing or fresh equity
✗ Interest cover of only 1.7x — little room if profits dip
✗ Debt has grown 52.8% a year — worth checking what it bought

Quality vs. Valuation

Company Quality

57/ 100

Average

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

Valuation

80/ 100

Cheap

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

19.3x

Sector Median

40.4x

median of 4 sector peers

🟢Against its sector it trades 52% below the peer median of 40.4x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

40.4x median of 4 peers · -52%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

19.3x

P/B

1.46x

EV/EBITDA

6.3x

PEG

—

Dividend Yield

0.96%

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 0.8% to 7.6% over 3 years.
Return on equity is rising
ROE has improved from -5.2% to 7.3%.
Return on capital is rising
ROCE has improved from -3.5% to 13.7%.

🔴 What Needs Attention2

Debt is rising
Total debt is up 256% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 256% over 3 years, from ₹20 Cr to ₹71 Cr.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.7x — little room if earnings dip.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹2 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 0.8% to 7.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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.

🔴 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
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 16% a year✓ 21.9% CAGR
Latest reported year was 21.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 6%✓ 7.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹2 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 1.7x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

4 / 10 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

Price history

Quick Metrics

3 good · 5 neutral · 3 weak

Market Cap

₹118 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.3x

Fair

Fairly valued against the generic band

P/B Ratio

1.46x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹10.77

Profitable

Profitable on a per-share basis

ROE

7.3%

Weak

Weak capital efficiency

ROCE

13.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

1.35x

Moderate

Moderate leverage

Revenue Growth (YoY)

21.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-5.9%

Falling

Profits are shrinking

Dividend Yield

0.96%

Modest

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

Free Cash Flow

-₹2 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹208

Operating Margin

4.6%

Weak

Thin margins leave little room for error

Net Margin

1.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.12

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.32

Defensive

Steadier than the market

52W Range Position

11%

Near low

Near its 52-week low

Technical Snapshot

RSI (14)

31.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹207 Cr	₹244 Cr	₹335 Cr	₹374 Cr	+21.9%
EBITDA	₹2 Cr	₹10 Cr	₹30 Cr	₹28 Cr	+154.5%
EBITDA Margin	0.8%	4.1%	8.9%	7.6%	—
PAT (Net Profit)	-₹4 Cr	-₹5 Cr	₹8 Cr	₹6 Cr	—
EPS	₹-6.66	₹-8.39	₹14.95	₹10.42	—
ROE	-5.2%	-7.0%	11.1%	7.3%	—
ROCE	-3.5%	1.8%	17.9%	13.7%	—
Total Debt	₹20 Cr	₹43 Cr	₹54 Cr	₹71 Cr	+52.8%
Free Cash Flow	-₹19 Cr	-₹4 Cr	₹0 Cr	-₹2 Cr	—

🟢 Revenue has grown at 21.9% a year over 3 years.

🟢 EBITDA has grown at 154.5% a year over 3 years.

🟢 EBITDA Margin has risen from 0.8% to 7.6% over 3 years (+6.8 pts).

🟢 PAT (Net Profit) has turned positive, from -₹4 Cr to ₹6 Cr.

🟢 EPS has turned positive, from ₹-6.66 to ₹10.42.

🟢 ROE has risen from -5.2% to 7.3% over 3 years (+12.5 pts).

🟢 ROCE has risen from -3.5% to 13.7% over 3 years (+17.3 pts).

🔴 Total Debt has grown at 52.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹255 Cr

Total Liabilities

₹174 Cr

Total Debt

₹71 Cr

Cash & Equivalents

₹9 Cr

Operating Cash Flow

₹12 Cr

Capex

-₹14 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

69.1%

Corporate Actions

Dividend Rate

₹2

Ex-Dividend Date

11 Sept 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

1 positive5 general

Bright Brothers Ltd. Share Price: Significant 9.9% Gain

Univest, 04 Aug

Bright Brothers Ltd. Financials – Balance Sheet, Profit & Loss, Cash Flow

Value Research, 27 Aug

Bright Brothers confirms 100% support for all resolutions at 79th AGM

scanx.trade, 18 Sept

Bright Brothers FY26 Audited Results Published; Final Dividend of Rs. 2 Per Share Recommended

scanx.trade, 14 MayCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Amtech Esters (BSE:544920) - Stock Analysis

Simply Wall Street, 18 Sept

BRIGHTBR Stock Price and Chart — NSE:BRIGHTBR

TradingView, 12 Aug

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate10.2/20

🔴Financial HealthStretched7/20

🟢GrowthStrong18.4/20

🟡ProfitabilityModerate7.1/15

🟢ValuationAttractive11.3/15

🔴RiskHigh4/10

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.

This thesis breaks if

✓Revenue growth stays above 16% a year21.9% CAGR
✓EBITDA margin holds above 6%7.6%
✗Debt / EBITDA stays below 2x2.5x
✗Free cash flow remains positive-₹2 Cr
✗Interest cover stays above 3x1.7x