Horizon Reclaim (India) Limited

Basic Materials — Specialty Chemicals · BSE

₹146.00−₹0.15 (−0.10%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

REASONABLE

Risk

Very High

Driven by moderate debt load, short-term liabilities exceed short-term assets, negative free cash flow.

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, 6:09 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Horizon Reclaim (India) Limited manufactures and supplies reclaimed rubber in India.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees81

Annual revenue₹46 Cr

How does it make money?

Turns over ₹46 Cr a year. Of every ₹100 of sales, about ₹23 reaches shareholders as profit, with ₹35 left at the operating level before interest, tax and depreciation. Each of its 81 employees supports ₹57.2 lakh of revenue a year, the signature of a people-led business.

EBITDA margin35.2%

Net margin22.7%

Revenue / employee₹57.2 lakh

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?Some evidence

ROCE of 35.4% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE35.4%

ROE53.6%

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 +136% while net margin moved +564% 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+136%

Margin effect+564%

DalalBaazaar Score

66/ 100

Good

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

79/ 100

Good

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

Valuation

66/ 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

27.1x

Sector Median

40.4x

median of 4 sector peers

🟢Against its sector it trades 33% 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 · -33%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

27.1x

P/B

8.38x

EV/EBITDA

19.6x

PEG

0.18

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 5.5% to 35.2% over 3 years.
Return on equity is rising
ROE has improved from 10.2% to 42.3%.
Return on capital is rising
ROCE has improved from 13.4% to 35.4%.
High return on capital employed
ROCE of 35.4% 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 Attention3

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Inventory building faster than sales
Inventory is up 674% against revenue growth of 136% — stock may not be moving.
Short-term liquidity is tight
Current ratio of 0.68 — near-term obligations exceed near-term assets.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Free cash flow negative for 3 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 674% against revenue up 136% — stock may not be moving.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.68 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 35.4% 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 5.5% to 35.2%. 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 33% 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?

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 25% a year✓ 33.1% CAGR
Latest reported year was 40.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 33%✓ 35.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹25 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 32%✓ 35.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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 · 4 neutral · 2 weak

Market Cap

₹285 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

27.1x

Fair

Fairly valued against the generic band

P/B Ratio

8.38x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹5.38

Profitable

Profitable on a per-share basis

ROE

53.6%

Strong

Strong capital efficiency

ROCE

35.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.44x

Moderate

Moderate leverage

Revenue Growth (YoY)

40.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

48.6%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹27 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹146

ROA

20.6%

Good

Assets are working hard

Operating Margin

30.6%

Good

Healthy core-business profitability

Net Margin

21.2%

Good

Strong bottom-line conversion

Current Ratio

0.68

Tight

Tight short-term liquidity

52W Range Position

70%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

141.8 / 131.2

Bullish alignment (short > long)

RSI (14)

68.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹20 Cr	₹20 Cr	₹33 Cr	₹46 Cr	+33.1%
EBITDA	₹1 Cr	₹1 Cr	₹10 Cr	₹16 Cr	+147.7%
EBITDA Margin	5.5%	5.3%	31.5%	35.2%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹7 Cr	₹11 Cr	+150.2%
EPS	₹0.34	₹0.36	₹3.62	₹5.38	+150.2%
ROE	10.2%	9.8%	49.3%	42.3%	—
ROCE	13.4%	12.8%	65.8%	35.4%	—
Total Debt	—	—	₹10 Cr	₹36 Cr	—
Free Cash Flow	₹0 Cr	-₹0 Cr	-₹10 Cr	-₹25 Cr	—

🟢 Revenue has grown at 33.1% a year over 3 years.

🟢 EBITDA has grown at 147.7% a year over 3 years.

🟢 EBITDA Margin has risen from 5.5% to 35.2% over 3 years (+29.8 pts).

🟢 PAT (Net Profit) has grown at 150.2% a year over 3 years.

🟢 EPS has grown at 150.2% a year over 3 years.

🟢 ROE has risen from 10.2% to 42.3% over 3 years (+32.1 pts).

🟢 ROCE has risen from 13.4% to 35.4% over 3 years (+22.0 pts).

🔴 Free Cash Flow has turned negative, from ₹0 Cr to -₹25 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹65 Cr

Total Liabilities

₹40 Cr

Total Debt

₹36 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹10 Cr

Capex

-₹35 Cr

Shareholding (proxy)

Institutional Holding

3.1%

Insider Holding

78.1%

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

Horizon Reclaim H1FY27 Results: Revenue rises 28.24% to ₹2,817.98 crore

scanx.trade, 17 OctResults

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

Horizon Reclaim (India) IPO Allotment Status: Check Allotment Status, Subscription and Key Issue Details

Groww, 16 Jun

Stellar Debut! Horizon Reclaim India share price lists at ₹151, a premium of 47% from SME IPO price

Livemint, 19 Jun

Horizon Reclaim India shares list at nearly 47% premium on BSE SME; here's how much individual investors made

Upstox, 18 Jun

Horizon Reclaim India IPO GMP, Review & Details

IndiaIPO, 07 Jun

Horizon Reclaim shares list at 47% premium over IPO price on BSE SME platform

The Economic Times, 19 Jun

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong17.9/20

🔴Financial HealthStretched8.8/20

🟢GrowthStrong18.5/20

🟢ProfitabilityStrong13.5/15

🔴ValuationDemanding5/15

🔴RiskHigh2.5/10

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

This thesis breaks if

✓Revenue growth stays above 25% a year33.1% CAGR
✓EBITDA margin holds above 33%35.2%
✗Debt / EBITDA stays below 2x2.2x
✗Free cash flow remains positive-₹25 Cr
✓ROCE stays above 32%35.4%