Indo SMC Limited

Industrials — Electrical Equipment & Parts · BSE

₹472.00−₹14.50 (−2.98%)

DalalBaazaar Score

61 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

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

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, 6:51 pm

Understanding the Business

Company site ↗

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

What does this company do?

Indo SMC Limited designs, manufactures, and supplies arrays of sheet moulding compounds, fiberglass reinforced plastic and GRP compounds, and composites.

IndustryElectrical Equipment & Parts

SectorIndustrials

Employees80

Annual revenue₹310 Cr

How does it make money?

Turns over ₹310 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹15 left at the operating level before interest, tax and depreciation. Each of its 80 employees supports ₹3.87 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.87 Cr

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?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 28.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 33.9% against a peer median of 17.1% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

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 +4146% while net margin moved +68% 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+4146%

Margin effect+68%

DalalBaazaar Score

61/ 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

71/ 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

26.1x

Sector Median

88.8x

median of 3 sector peers

🟢Against its sector it trades 71% 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 · -71%

vs. generic bands

Fair

15x–35x

EV/EBITDA

23.0x

PEG

0.08

What's Good / What's Bad

🟢 What's Going Well3

Return on capital is rising
ROCE has improved from 18.8% to 28.3%.
High return on capital employed
ROCE of 28.3% 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 Attention1

Return on equity is falling
ROE has dropped from 38.9% to 21.0% — each rupee of shareholder capital earns less than it did.

Red Flags

3 items require attention · 3 high

🔴Debt has risen sharplyFinancial
Total debt is up 350% over 3 years, from ₹10 Cr to ₹47 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.
🔴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.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 28.3% 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.
Cheaper than its peers
It trades 71% 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?

Returns on shareholder capital are falling
ROE has dropped from 38.9% to 21.0%. 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 187% a year✓ 248.9% CAGR
Latest reported year was 123.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 13%✓ 15.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹42 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 25%✓ 28.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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

6 good · 3 neutral · 2 weak

Market Cap

₹1,079 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

26.1x

Fair

Fairly valued against the generic band

P/B Ratio

7.00x

Rich

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

EPS (TTM)

₹18.09

Profitable

Profitable on a per-share basis

ROE

33.9%

Strong

Strong capital efficiency

ROCE

28.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.30x

Low

Conservative leverage

Revenue Growth (YoY)

123.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

92.4%

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

-₹54 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

17.6%

Good

Assets are working hard

Operating Margin

13.2%

Average

Average margins

Net Margin

10.5%

Good

Strong bottom-line conversion

Current Ratio

2.98

Comfortable

Healthy short-term liquidity

52W Range Position

85%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

497.2 / 495.4

Bullish alignment (short > long)

RSI (14)

39.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹7 Cr	₹28 Cr	₹139 Cr	₹310 Cr	+248.9%
EBITDA	₹1 Cr	₹5 Cr	₹23 Cr	₹47 Cr	+243.1%
EBITDA Margin	15.8%	18.1%	16.4%	15.1%	—
PAT (Net Profit)	₹0 Cr	₹3 Cr	₹17 Cr	₹32 Cr	+314.4%
EPS	₹0.2	₹1.31	₹7.36	—	—
ROE	38.9%	51.8%	45.8%	21.0%	—
ROCE	18.8%	45.1%	50.9%	28.3%	—
Total Debt	₹10 Cr	₹18 Cr	₹36 Cr	₹47 Cr	+65.1%
Free Cash Flow	-₹6 Cr	-₹8 Cr	-₹28 Cr	-₹42 Cr	—

🟢 Revenue has grown at 248.9% a year over 3 years.

🟢 EBITDA has grown at 243.1% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 15.1% over 3 years.

🟢 PAT (Net Profit) has grown at 314.4% a year over 3 years.

🔴 ROE has fallen from 38.9% to 21.0% over 3 years (-17.9 pts).

🟢 ROCE has risen from 18.8% to 28.3% over 3 years (+9.5 pts).

🔴 Total Debt has grown at 65.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹224 Cr

Total Liabilities

₹70 Cr

Cash & Equivalents

₹51 Cr

Operating Cash Flow

-₹35 Cr

Capex

-₹7 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

70.2%

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

2 mixed4 general

Indo SMC (BSE:544681) - Stock Analysis

Simply Wall Street, 15 Oct

APLAB - Comparison Results

Equitymaster, 16 OctResults

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

INDO SMC Limited Share Price Near 52-Week High Analysis

Univest, 17 Aug

Indo SMC - Ashish Kacholia's Q1 portfolio: 13 stocks the ace investor bought, sold or likely exited. Full list

The Economic Times, 24 JulResults

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

Recently listed Indo SMC bags ₹66.6 crore order from engineering firm; stock jumps 190% from March lows

Livemint, 22 Jul

Indo Smc wins Rs 31.71 crore work order from Gujarat-based power distribution firm

scanx.trade, 05 Oct

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability

WeakValuation · Risk

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 ↑