Goyal Salt Limited

Sector n/a · NSE

₹174.60+₹3.35 (+1.96%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

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

In simple words: Strong business and financial position, 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, 7:02 pm

Understanding the Business

The 60-second version of Goyal Salt 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 ₹200 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 22.7%. Returns that high normally get competed away; when they persist, something is protecting them. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +70% while net margin moved +89% 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+70%

Margin effect+89%

DalalBaazaar Score

59/ 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
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

66/ 100

Good

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

14.6x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 5.8% to 12.2% over 3 years.
High return on capital employed
ROCE of 22.7% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 21.8% to 17.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 35.8% to 22.7% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 382% over 3 years, from ₹9 Cr to ₹44 Cr.
🔴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.
🔴Inventory building faster than salesFinancial
Inventory up 531% against revenue up 70% — stock may not be moving.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 30.3x to 5.7x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 22.7% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 5.8% to 12.2%. 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?

Returns on shareholder capital are falling
ROE has dropped from 21.8% to 17.0%. 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.
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
3 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 14% a year✓ 19.3% CAGR
Latest reported year was 53.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 10%✓ 12.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹21 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.8x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 20%✓ 22.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 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

3 good · 6 neutral · 2 weak

Market Cap

₹313 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

17.0%

Strong

Strong capital efficiency

ROCE

22.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.66x

Moderate

Moderate leverage

Revenue Growth (YoY)

53.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-14.3%

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

-₹21 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Gross Margin

35.7%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

5.7%

Average

Average bottom-line conversion

Current Ratio

1.48

Comfortable

Healthy short-term liquidity

Technical Snapshot

SMA 20 / SMA 50

103.8 / 105.5

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

47.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹118 Cr	₹118 Cr	₹130 Cr	₹200 Cr	+19.3%
EBITDA	₹7 Cr	₹7 Cr	₹19 Cr	₹24 Cr	+53.2%
EBITDA Margin	5.8%	6.4%	14.9%	12.2%	—
PAT (Net Profit)	₹4 Cr	₹9 Cr	₹13 Cr	₹11 Cr	+47.5%
EPS	₹1.98	₹6.15	₹7.4	—	—
ROE	21.8%	22.4%	23.9%	17.0%	—
ROCE	35.8%	29.9%	25.4%	22.7%	—
Total Debt	₹9 Cr	₹6 Cr	₹21 Cr	₹44 Cr	+69.0%
Free Cash Flow	-₹3 Cr	-₹5 Cr	-₹16 Cr	-₹21 Cr	—

🟢 Revenue has grown at 19.3% a year over 3 years.

🟢 EBITDA has grown at 53.2% a year over 3 years.

🟢 EBITDA Margin has risen from 5.8% to 12.2% over 3 years (+6.5 pts).

🟢 PAT (Net Profit) has grown at 47.5% a year over 3 years.

🔴 ROE has fallen from 21.8% to 17.0% over 3 years (-4.8 pts).

🔴 ROCE has fallen from 35.8% to 22.7% over 3 years (-13.1 pts).

🔴 Total Debt has grown at 69.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹121 Cr

Total Liabilities

₹54 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹2 Cr

Capex

-₹19 Cr

Recent News

6 general

3,582,000 Equity Shares of Goyal Salt Limited are subject to a Lock-Up Agreement Ending on 15-OCT-2026.

www.marketscreener.com, 15 Oct

Goyal Salt Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 02 Sept

Goyal Salt Limited Appoints M/s PSAG & Associates as Internal Auditor for FY 2026-27

scanx.trade, 12 May

Goyal Salt Ltd Peer Comparison – Compare with Others

Value Research, 04 Sept

IWP Stock Price and Chart — NSE:IWP

TradingView, 20 Apr

Goyal Salt IPO Day 5: Issue subscribed over 294.61 times on last day; retail portion booked 377x

Livemint, 03 Oct

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.

DalalBaazaar Thesis

StrongGrowth

MiddlingBusiness Quality · Financial Health · Profitability · Valuation

WeakRisk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 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 ↑