Kesar Petroproducts Limited

Basic Materials — Chemicals · BSE

₹14.00−₹0.71 (−4.83%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. 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

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 Kesar Petroproducts Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Kesar Petroproducts Limited manufactures and sells phthalocyanine blue crude and its downstream products in India and internationally. It offers inks, coating, plastic, offset, universal, anti-corrosives, and fertilizers products.

IndustryChemicals

SectorBasic Materials

Employees165

Annual revenue₹187 Cr

How does it make money?

Turns over ₹187 Cr a year. Of every ₹100 of sales, about ₹5 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 165 employees supports ₹1.13 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin11.7%

Net margin5.2%

Revenue / employee₹1.13 Cr

Who are its competitors?

The closest listed comparisons in its industry are PIDILITE INDUSTRIES LTD, SRF LTD, UPL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

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?Little sign of one

Returns on capital of 8.7% 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.

ROCE8.7%

ROE6.5%

Peer median ROE15.4%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +56% while net margin moved +1225% 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+56%

Margin effect+1225%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of -0.19 — 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

57/ 100

Average

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

Valuation

54/ 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

48.3x

3Y Median

47.2x

40 monthly readings · mean 91.0x · range 14.5x–372.4x

Sector Median

33.8x

median of 3 sector peers

🟡Currently trading close to its 3y median of 47.2x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 43% above the peer median of 33.8x.

vs. its own history

Fair

47.2x median over 40 months · +2%

vs. sector peers

Expensive

33.8x median of 3 peers · +43%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

48.3x

P/B

0.91x

EV/EBITDA

10.1x

PEG

0.28

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 9.0% to 11.7% over 3 years.
Return on equity is rising
ROE has improved from 0.4% to 6.5%.
Return on capital is rising
ROCE has improved from 1.2% to 8.7%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Debt is rising
Total debt is up 45% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Inventory building faster than sales
Inventory is up 108% against revenue growth of 56% — stock may not be moving.

Red Flags

4 items require attention · 1 high · 3 watch

🔴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.
🟡Debt is increasingFinancial
Total debt is up 45% over 3 years.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 17.3x to 4.2x.
🟡Inventory building faster than salesFinancial
Inventory up 108% against revenue up 56% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 9.0% to 11.7%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

The debt load needs earnings to hold up
Debt is 3.3x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
A premium to the sector to defend
It trades 43% above the peer median. That premium needs a reason that persists, or it closes.
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

1Revenue growth stays above 12% a year✓ 16.0% CAGR
Latest reported year was -0.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 10%✓ 11.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 3.3x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹7 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✓ 8.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

3 / 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

3 good · 3 neutral · 5 weak

Market Cap

₹156 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

48.3x

Expensive

Expensive — verify against sector peers

P/B Ratio

0.91x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.29

Profitable

Profitable on a per-share basis

ROE

6.5%

Weak

Weak capital efficiency

ROCE

8.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.48x

Low

Conservative leverage

Revenue Growth (YoY)

-0.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

-90.0%

Falling

Profits are shrinking

Dividend Yield

None

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

Free Cash Flow

-₹7 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹14

Operating Margin

100.0%

Good

Healthy core-business profitability

Net Margin

2.3%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.39

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.19

Defensive

Steadier than the market

52W Range Position

15%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

12.7 / 13.9

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

56.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹120 Cr	₹149 Cr	₹185 Cr	₹187 Cr	+16.0%
EBITDA	₹11 Cr	₹9 Cr	₹17 Cr	₹22 Cr	+26.7%
EBITDA Margin	9.0%	5.9%	9.3%	11.7%	—
PAT (Net Profit)	₹0 Cr	₹5 Cr	₹10 Cr	₹10 Cr	+174.5%
EPS	₹0.05	₹0.51	₹0.85	₹0.83	+155.1%
ROE	0.4%	4.0%	6.9%	6.5%	—
ROCE	1.2%	3.6%	7.6%	8.7%	—
Total Debt	₹50 Cr	₹55 Cr	₹73 Cr	₹72 Cr	+13.2%
Free Cash Flow	-₹3 Cr	-₹38 Cr	-₹3 Cr	-₹7 Cr	—

🟢 Revenue has grown at 16.0% a year over 3 years.

🟢 EBITDA has grown at 26.7% a year over 3 years.

🟢 EBITDA Margin has risen from 9.0% to 11.7% over 3 years (+2.7 pts).

🟢 PAT (Net Profit) has grown at 174.5% a year over 3 years.

🟢 EPS has grown at 155.1% a year over 3 years.

🟢 ROE has risen from 0.4% to 6.5% over 3 years (+6.1 pts).

🟢 ROCE has risen from 1.2% to 8.7% over 3 years (+7.6 pts).

🔴 Total Debt has grown at 13.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹245 Cr

Total Liabilities

₹96 Cr

Total Debt

₹72 Cr

Cash & Equivalents

₹6 Cr

Operating Cash Flow

₹30 Cr

Capex

-₹38 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

73.7%

Corporate Actions

Ex-Dividend Date

23 Sept 2015

Peer Comparison

Company	P/E	ROE
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

2 mixed4 general

Kesar Petroproducts Ltd. Share Price Rise Streak: Analysis

Univest, 14 OctPrice 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.

Kesar Petroproducts Upper Circuit Today: Price, Data and Peers

Univest, 13 Oct

Kesar Petroproducts reports Q4FY26 net loss of ₹506 lakh

scanx.trade, 22 May

Kesar Petroproducts Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

Kesar Petroproducts reports standalone net loss of Rs 5.06 crore in the March 2026 quarter

Business Standard, 29 MayResults

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

Kesar Petroproducts Ltd is Rated Sell

MarketsMojo, 07 Oct

Watch Items

Revenue growth is negative (-0.8%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🔴Business QualityWeak8.7/20

🟡Financial HealthAdequate11.7/20

🟢GrowthStrong14.9/20

🟡ProfitabilityModerate7.1/15

🟡ValuationFair8.3/15

🔴RiskHigh4/10

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.

This thesis breaks if

✓Revenue growth stays above 12% a year16.0% CAGR
✓EBITDA margin holds above 10%11.7%
✗Debt / EBITDA falls below 3x3.3x
✗Free cash flow remains positive-₹7 Cr
✓ROCE stays above 8%8.7%