India Gelatine & Chemicals Limited

Basic Materials — Specialty Chemicals · BSE

₹369.00+₹3.45 (+0.94%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

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

What does this company do?

India Gelatine & Chemicals Limited engages in the manufacture and sale of chemical products in India, the Far East, Europe, and internationally.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees103

Annual revenue₹169 Cr

How does it make money?

Turns over ₹169 Cr a year. Of every ₹100 of sales, about ₹15 reaches shareholders as profit, with ₹19 left at the operating level before interest, tax and depreciation. Each of its 103 employees supports ₹1.64 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.64 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.

Compared side by side in Peers ↓

What is its competitive advantage?Some evidence

ROCE of 16.2% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

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 -17% while net margin moved +26% 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-17%

Margin effect+26%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 5.9% a year
✗ Profit CAGR of only 1.6%

Quality vs. Valuation

Company Quality

53/ 100

Average

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

10.0x

2Y Median

10.4x

28 monthly readings · mean 11.4x · range 8.3x–15.3x

Sector Median

40.4x

median of 4 sector peers

🟡Currently trading close to its 2y median of 10.4x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 75% below the peer median of 40.4x.

vs. its own history

Fair

10.4x median over 28 months · -4%

vs. sector peers

Cheap

40.4x median of 4 peers · -75%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.2x

PEG

6.08

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 17.4% to 19.1% over 3 years.
Debt is being paid down
Total debt is down 59% 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 equity is falling
ROE has dropped from 17.5% to 13.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 20.8% to 16.2% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 2.13x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 17.4% to 19.1%. 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 59% 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 75% 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 2.13x. Interest is payable whether or not the business has a good year.
Returns on shareholder capital are falling
ROE has dropped from 17.5% to 13.0%. 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.
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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 17%✓ 19.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹13 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 13%✓ 16.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 10.4x✓ 10.0x today
A re-rating above its own history needs a reason; without one it is just a higher price.

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

7 good · 3 neutral · 1 weak

Market Cap

₹262 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.0x

Cheap

Cheap against the generic band

P/B Ratio

1.35x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹36.8

Profitable

Profitable on a per-share basis

ROE

13.0%

Moderate

Moderate capital efficiency

ROCE

16.2%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

2.13x

High

High leverage

Revenue Growth (YoY)

16.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

14.1%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.63%

Modest

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

Free Cash Flow

₹13 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

18.2%

Good

Healthy core-business profitability

Net Margin

14.8%

Good

Strong bottom-line conversion

Current Ratio

8.91

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.05

Defensive

Steadier than the market

52W Range Position

60%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

370.5 / 374.1

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

46.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹203 Cr	₹206 Cr	₹198 Cr	₹169 Cr	-5.9%
EBITDA	₹35 Cr	₹39 Cr	₹26 Cr	₹32 Cr	-3.0%
EBITDA Margin	17.4%	19.0%	13.1%	19.1%	—
PAT (Net Profit)	₹24 Cr	₹28 Cr	₹17 Cr	₹25 Cr	+1.6%
EPS	₹33.7	₹40.03	₹24.52	₹35.39	+1.6%
ROE	17.5%	18.4%	10.1%	13.0%	—
ROCE	20.8%	22.5%	12.5%	16.2%	—
Total Debt	₹10 Cr	₹8 Cr	₹6 Cr	₹4 Cr	-25.8%
Free Cash Flow	-₹6 Cr	₹3 Cr	₹9 Cr	₹13 Cr	—

🔴 Revenue has shrunk at 5.9% a year over 3 years.

🔴 EBITDA has shrunk at 3.0% a year over 3 years.

🟢 EBITDA Margin has risen from 17.4% to 19.1% over 3 years (+1.7 pts).

🟡 PAT (Net Profit) has been broadly flat over 3 years (1.6% a year).

🟡 EPS has been broadly flat over 3 years (1.6% a year).

🔴 ROE has fallen from 17.5% to 13.0% over 3 years (-4.6 pts).

🔴 ROCE has fallen from 20.8% to 16.2% over 3 years (-4.6 pts).

🟢 Total Debt has shrunk at 25.8% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹6 Cr to ₹13 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹217 Cr

Total Liabilities

₹24 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹28 Cr

Capex

-₹15 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

74.0%

Corporate Actions

Dividend Rate

₹6

Ex-Dividend Date

18 Aug 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 mixed5 general

India Gelatine posts stronger first-quarter profit as sales growth outpaces costs

Indiatimes, 12 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

India Gelatine & Chemicals sets Aug 25 for 54th AGM after PAT surge

scanx.trade, 29 Jul

India Gelatine & Chemicals (BSE: 531253): Diversified Chemicals Classification Explained

Kalkine India, 16 Sept

INDIA GELATINE & CHEMICALS LTD Share Price - Live INDGELA Stock Price & Chart

Upstox, 25 Mar

Godrej Industries lines up chemistry summit on resilience, AI and India’s industrial future

Indiatimes, 12 Aug

India Gelatine & Chemicals (BSE:531253) - Stock Analysis

Simply Wall Street, 02 Dec

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability

WeakGrowth · Risk

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. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑