The KCP Limited

Basic Materials — Building Materials · NSE

₹154.39+₹1.10 (+0.72%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

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

In simple words: Reasonable but unspectacular business quality, with modest growth. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 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 The KCP Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

The KCP Limited engages in cement, heavy engineering, power generation, and hospitality businesses in India. It operates through Cement Unit, Engineering Unit, Hotel, and Sugar segments.

IndustryBuilding Materials

SectorBasic Materials

Employees836

Annual revenue₹2,563 Cr

How does it make money?

Turns over ₹2,563 Cr a year. Of every ₹100 of sales, about ₹8 reaches shareholders as profit, with ₹16 left at the operating level before interest, tax and depreciation. Each of its 836 employees supports ₹3.07 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin16.2%

Net margin7.7%

Revenue / employee₹3.07 Cr

Who are its competitors?

The closest listed comparisons in its industry are ULTRATECH CEMENT LIMITED, GRASIM INDUSTRIES LTD, AMBUJA CEMENTS LTD, SHREE CEMENT LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

ULTRATECH CEMENT LIMITEDP/E 37.6x · ROE 11.1%

GRASIM INDUSTRIES LTDP/E 34.8x · ROE 5.5%

AMBUJA CEMENTS LTDP/E 20.4x · ROE 7.4%

SHREE CEMENT LIMITEDP/E 49.7x · ROE 7.0%

What is its competitive advantage?Little sign of one

Returns on capital of 11.5% 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.

ROCE11.5%

ROE13.1%

Peer median ROE7.4%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +14% while net margin moved +314% 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+14%

Margin effect+314%

DalalBaazaar Score

66/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.67 — historically steadier than the index
✗ 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

88/ 100

Cheap

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

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

11.7x

3Y Median

15.8x

40 monthly readings · mean 26.0x · range 10.0x–76.8x

Sector Median

36.2x

median of 4 sector peers

🟢Current valuation is approximately 26% below its 3y median of 15.8x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 68% below the peer median of 36.2x.

vs. its own history

Cheap

15.8x median over 40 months · -26%

vs. sector peers

Cheap

36.2x median of 4 peers · -68%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

11.7x

P/B

1.12x

EV/EBITDA

6.4x

PEG

0.17

Dividend Yield

0.65%

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from 9.4% to 16.2% over 3 years.
Return on equity is rising
ROE has improved from 3.4% to 11.1%.
Return on capital is rising
ROCE has improved from 6.6% to 11.5%.
Valuation below its historical average
At 11.7x the stock trades 26% below its own median of 15.8x.
Very low debt
Debt/Equity of 0.29x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Free cash flow is negative
The business is not currently covering its capital spending from operations.

Red Flags

1 item require attention · 1 watch

🟡Free cash flow is negativeFinancial
Free cash flow was -₹67 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 9.4% to 16.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 26% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 68% 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?

Growth barely outpaces inflation
Revenue compounding at 4.5% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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.

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

1EBITDA margin holds above 14%✓ 16.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹67 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 4% a year✓ 4.5% CAGR
Latest reported year was 7.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 1.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 9%✓ 11.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 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 · 5 neutral · 1 weak

Market Cap

₹1,990 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

11.7x

Cheap

Cheap against the generic band

P/B Ratio

1.12x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹13.22

Profitable

Profitable on a per-share basis

ROE

13.1%

Moderate

Moderate capital efficiency

ROCE

11.5%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.29x

Low

Conservative leverage

Revenue Growth (YoY)

7.7%

Modest

Modest growth

Profit Growth (YoY)

126.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.65%

Modest

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

Free Cash Flow

-₹115 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹154.39

P/E (Forward)

39.6x

Flat

At or above the trailing multiple — no earnings uplift is being priced in

ROA

4.8%

Average

Average asset productivity

Operating Margin

14.3%

Average

Average margins

Net Margin

7.7%

Average

Average bottom-line conversion

Current Ratio

2.80

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.67

Defensive

Steadier than the market

52W Range Position

35%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

155.6 / 159.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

22.7

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,246 Cr	₹2,840 Cr	₹2,520 Cr	₹2,563 Cr	+4.5%
EBITDA	₹211 Cr	₹424 Cr	₹391 Cr	₹414 Cr	+25.2%
EBITDA Margin	9.4%	14.9%	15.5%	16.2%	—
PAT (Net Profit)	₹42 Cr	₹189 Cr	₹147 Cr	₹197 Cr	+67.8%
EPS	₹3.24	₹14.63	₹11.41	₹15.29	+67.7%
ROE	3.4%	13.4%	9.6%	11.1%	—
ROCE	6.6%	16.1%	12.0%	11.5%	—
Total Debt	₹558 Cr	₹480 Cr	₹542 Cr	₹664 Cr	+6.0%
Free Cash Flow	-₹106 Cr	₹72 Cr	-₹42 Cr	-₹67 Cr	—

🟢 Revenue has grown at 4.5% a year over 3 years.

🟢 EBITDA has grown at 25.2% a year over 3 years.

🟢 EBITDA Margin has risen from 9.4% to 16.2% over 3 years (+6.8 pts).

🟢 PAT (Net Profit) has grown at 67.8% a year over 3 years.

🟢 EPS has grown at 67.7% a year over 3 years.

🟢 ROE has risen from 3.4% to 11.1% over 3 years (+7.7 pts).

🟢 ROCE has risen from 6.6% to 11.5% over 3 years (+4.9 pts).

🔴 Total Debt has grown at 6.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,582 Cr

Total Liabilities

₹1,321 Cr

Total Debt

₹664 Cr

Cash & Equivalents

₹21 Cr

Operating Cash Flow

₹206 Cr

Capex

-₹273 Cr

Shareholding (proxy)

Institutional Holding

1.5%

Insider Holding

54.3%

Corporate Actions

Dividend Rate

₹1

Ex-Dividend Date

12 Aug 2026

Peer Comparison

Company	P/E	ROE
ULTRATECH CEMENT LIMITED	37.6x	11.1%
GRASIM INDUSTRIES LTD	34.8x	5.5%
AMBUJA CEMENTS LTD	20.4x	7.4%
SHREE CEMENT LIMITED	49.7x	7.0%

Recent News

4 mixed2 general

Kcp Ltd Share Price Target, Forecast for Long Term Equity.

HDFC Sky, 17 MayAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

KCP Ltd. Share Price rises 9.55%: valuation and sector view

Univest, 24 AugPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

KCP Ltd closes trading window from July 1 till Q1FY27 results

scanx.trade, 19 JunResults

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

Is K.C.P. Sugar and Industries (NSE:KCPSUGIND) A Risky Investment?

Simply Wall Street, 22 Jan

KCP Sugar & Industries Corporation Ltd. Share Price Live Today

CNBC TV18, 03 Jan

KCP Share Price Target 2027 2028 and 2030

Univest, 10 AugAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

🟡Business QualityAdequate11.7/20

🟢Financial HealthStrong14.5/20

🟢GrowthStrong13.1/20

🟡ProfitabilityModerate9.6/15

🟢ValuationAttractive13.2/15

🔴RiskHigh4/10

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last.

This thesis breaks if

✓EBITDA margin holds above 14%16.2%
✗Free cash flow remains positive-₹67 Cr
✓Revenue growth stays above 4% a year4.5% CAGR
✓Debt / EBITDA stays below 2x1.6x
✓ROCE stays above 9%11.5%