Hariyana Ship Breakers Limited

Industrials — Waste Management · NSE

₹93.60−₹1.84 (−1.93%)

DalalBaazaar Score

49 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, with modest growth. Debt is 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 Hariyana Ship Breakers Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Hariyana Ship Breakers Limited, together with its subsidiary, engages in the ship breaking business in India and internationally. The company is involved in ship recycling activities; industrial gases; and real estate developments.

IndustryWaste Management

SectorIndustrials

Employees8

Annual revenue₹3 Cr

How does it make money?

Turns over ₹3 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹256 left at the operating level before interest, tax and depreciation. Each of its 8 employees supports ₹43.7 lakh of revenue a year, the signature of a people-led business.

EBITDA margin255.6%

Net margin11.3%

Revenue / employee₹43.7 lakh

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

What is its competitive advantage?Little sign of one

Returns on capital of -0.0% 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.

ROCE-0.0%

ROE0.3%

Peer median ROE15.2%

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 -94% while net margin moved +48% 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-94%

Margin effect+48%

DalalBaazaar Score

49/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 59.9% a year
✗ Profit has declined at 54.2% a year

Quality vs. Valuation

Company Quality

43/ 100

Weak

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

Valuation

87/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

14.0x

Sector Median

88.8x

median of 3 sector peers

🟢Against its sector it trades 84% below the peer median of 88.8x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

88.8x median of 3 peers · -84%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

14.0x

P/B

0.39x

EV/EBITDA

6.9x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 14.2% to 255.6% over 3 years.
Debt is being paid down
Total debt is down 81% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on capital is falling
ROCE has declined from 4.8% to -0.0% — often a sign of competition or overexpansion.
Short-term liquidity is tight
Current ratio of 0.64 — near-term obligations exceed near-term assets.

Red Flags

5 items require attention · 2 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 2.98x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only -0.0x — little room if earnings dip.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.4x to -0.0x.
🟡Profit is decliningFinancial
Net profit is down 90% over 3 years.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.64 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 14.2% to 255.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 81% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 84% 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?

Leverage amplifies any setback
Debt/Equity of 2.98x. Interest is payable whether or not the business has a good year.
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

1EBITDA margin holds above 254%✓ 255.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Interest cover stays above 3x✗ -0.0x
How much operating profit can fall before interest stops being comfortably covered.
3Free cash flow remains positive✓ ₹3 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ -0.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 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

5 good · 3 neutral · 3 weak

Market Cap

₹58 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

14.0x

Cheap

Cheap against the generic band

P/B Ratio

0.39x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹6.68

Profitable

Profitable on a per-share basis

ROE

0.3%

Weak

Weak capital efficiency

ROCE

-0.0%

Weak

Low return on total capital employed

Debt/Equity

2.98x

High

High leverage

Revenue Growth (YoY)

8.7%

Modest

Modest growth

Profit Growth (YoY)

544.1%

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

₹3 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹93.6

Operating Margin

76.2%

Good

Healthy core-business profitability

Net Margin

23.5%

Good

Strong bottom-line conversion

Current Ratio

0.64

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.68

Defensive

Steadier than the market

52W Range Position

15%

Mid-range

Technical Snapshot

RSI (14)

41.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹54 Cr	₹149 Cr	₹0 Cr	₹3 Cr	-59.9%
EBITDA	₹8 Cr	₹6 Cr	₹6 Cr	₹9 Cr	+5.2%
EBITDA Margin	14.2%	4.3%	2754.1%	255.6%	—
PAT (Net Profit)	₹4 Cr	₹3 Cr	₹2 Cr	₹0 Cr	-54.2%
EPS	₹6.66	₹5.23	₹2.6	₹0.64	-54.2%
ROE	2.9%	2.2%	1.1%	0.3%	—
ROCE	4.8%	3.6%	3.4%	-0.0%	—
Total Debt	₹23 Cr	₹15 Cr	₹16 Cr	₹4 Cr	-42.6%
Free Cash Flow	-₹48 Cr	₹2 Cr	-₹2 Cr	₹3 Cr	—

🔴 Revenue has shrunk at 59.9% a year over 3 years.

🟢 EBITDA has grown at 5.2% a year over 3 years.

🟢 EBITDA Margin has risen from 14.2% to 255.6% over 3 years (+241.4 pts).

🔴 PAT (Net Profit) has shrunk at 54.2% a year over 3 years.

🔴 EPS has shrunk at 54.2% a year over 3 years.

🔴 ROE has fallen from 2.9% to 0.3% over 3 years (-2.6 pts).

🔴 ROCE has fallen from 4.8% to -0.0% over 3 years (-4.8 pts).

🟢 Total Debt has shrunk at 42.6% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹48 Cr to ₹3 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹155 Cr

Total Liabilities

₹8 Cr

Total Debt

₹4 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.9%

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

1 positive5 general

Hariyana Ship Breakers Q1 Results: Net profit rises 544% YoY to ₹441 lakh

scanx.trade, 12 AugResults

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

Hariyana Ship Breakers Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 04 Sept

5 Shipbuilding & Ship Recycling Stocks to Watch Amid India's US$ 8 Billion Push

Equitymaster, 03 Jul

Hariyana Ship Breakers passes all resolutions at 45th AGM

scanx.trade, 30 Sept

Hariyana Ship Breakers Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 04 Sept

This BSE listed ship breaking stock has zoomed 79% in 4 trading days

Business Standard, 16 Jul

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate11.5/20

🟡Financial HealthAdequate9.1/20

🔴GrowthWeak2.4/20

🟡ProfitabilityModerate8.9/15

🟢ValuationAttractive13/15

🔴RiskHigh4.3/10

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 254%255.6%
✗Interest cover stays above 3x-0.0x
✓Free cash flow remains positive₹3 Cr
✓Debt / EBITDA stays below 2x0.5x
✗ROCE stays above 8%-0.0%