Dhanashree Electronics Limited

Industrials — Electrical Equipment & Parts · BSE

₹112.50−₹12.50 (−10.00%)

DalalBaazaar Score

45 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:59 pm

Understanding the Business

Company site ↗

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

What does this company do?

Dhanashree Electronics Limited engages in the manufacture, supply, marketing, and sale of lighting products under the Rashmi brand in India.

IndustryElectrical Equipment & Parts

SectorIndustrials

Annual revenue₹112 Cr

How does it make money?

Turns over ₹112 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation.

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, HAVELLS INDIA 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?Little sign of one

Returns on capital of 10.8% 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 ROE17.1%

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 +137% while net margin moved -42% 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+137%

Margin effect-42%

DalalBaazaar Score

45/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 5.3% is weak

Quality vs. Valuation

Company Quality

47/ 100

Average

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

Valuation

42/ 100

Expensive

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

61.8x

3Y Median

46.9x

40 monthly readings · mean 54.0x · range 20.0x–169.2x

Sector Median

88.8x

median of 3 sector peers

⚠️Current valuation is approximately 32% above its 3y median of 46.9x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 30% below the peer median of 88.8x.

vs. its own history

Expensive

46.9x median over 40 months · +32%

vs. sector peers

Cheap

88.8x median of 3 peers · -30%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

17.3x

PEG

5.57

What's Good / What's Bad

🟢 What's Going Well1

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

4 items require attention · 4 high

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.7x — little room if earnings dip.
🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴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.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 17.4 points, from 28.5% to 11.1%.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 30% 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 28.5% to 11.1%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 32% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
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
4 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 25% a year✓ 33.3% CAGR
Latest reported year was -11.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 9%✓ 11.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 4.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹8 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

3 / 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

2 good · 4 neutral · 5 weak

Market Cap

₹160 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

61.8x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.28x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹1.82

Profitable

Profitable on a per-share basis

ROE

5.3%

Weak

Weak capital efficiency

ROCE

10.8%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.51x

Low

Conservative leverage

Revenue Growth (YoY)

-11.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

-56.8%

Falling

Profits are shrinking

Dividend Yield

0.09%

Modest

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

Free Cash Flow

-₹8 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

7.3%

Average

Average margins

Net Margin

3.2%

Average

Average bottom-line conversion

Current Ratio

2.77

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.00

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

123.5 / 128.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

41.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹47 Cr	₹80 Cr	₹98 Cr	₹112 Cr	+33.3%
EBITDA	₹13 Cr	₹12 Cr	₹13 Cr	₹12 Cr	-2.6%
EBITDA Margin	28.5%	15.0%	13.1%	11.1%	—
PAT (Net Profit)	₹3 Cr	₹4 Cr	₹3 Cr	₹4 Cr	+11.1%
EPS	₹1.89	₹2.76	₹2.44	₹1.49	-7.6%
ROE	7.8%	10.2%	8.3%	5.3%	—
ROCE	12.4%	13.7%	14.0%	10.8%	—
Total Debt	₹52 Cr	₹63 Cr	₹64 Cr	₹56 Cr	+2.4%
Free Cash Flow	-₹15 Cr	-₹13 Cr	-₹7 Cr	-₹8 Cr	—

🟢 Revenue has grown at 33.3% a year over 3 years.

🔴 EBITDA has shrunk at 2.6% a year over 3 years.

🔴 EBITDA Margin has fallen from 28.5% to 11.1% over 3 years (-17.4 pts).

🟢 PAT (Net Profit) has grown at 11.1% a year over 3 years.

🔴 EPS has shrunk at 7.6% a year over 3 years.

🔴 ROE has fallen from 7.8% to 5.3% over 3 years (-2.5 pts).

🔴 ROCE has fallen from 12.4% to 10.8% over 3 years (-1.6 pts).

🔴 Total Debt has grown at 2.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹156 Cr

Total Liabilities

₹86 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹8 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

82.3%

Corporate Actions

Dividend Rate

₹0.1

Ex-Dividend Date

23 Sept 2026

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

1 mixed5 general

Dhanashree Electronics Lower Circuit Today: Price, Data and Peers

Univest, 16 Oct

Dhanashree Electronics shareholders approve all four AGM resolutions

scanx.trade, 15 Oct

Dhanashree Electronics Share Price Rise Streak, fundamentals

Univest, 13 OctPrice 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.

Compare with

Equitymaster, 09 Oct

Dhanashree Electronics Ltd. Peer Comparison – Compare with Others

Value Research, 29 Aug

Dhanashree Electronics accepts Company Secretary Gopal Sharma's resignation

scanx.trade, 04 Oct

Watch Items

Revenue growth is negative (-11.3%) on the latest reported period — check if this is one-off or a trend.
Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

MiddlingBusiness Quality · Financial Health · Growth · Risk

WeakProfitability · Valuation

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. 4 high-severity red flags sit above this conclusion and should be read first.

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