Lahoti Overseas Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹39.99+₹0.85 (+2.17%)

DalalBaazaar Score

47 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by negative free cash flow, 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. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Lahoti Overseas Limited, together with its subsidiaries, engages in the export trading of cotton yarns and fabrics in India, Bangladesh, Turkey, China, South Korea, Peru, Egypt, and Germany. It operates through Trading, Power, and Others segments.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees39

Annual revenue₹366 Cr

How does it make money?

Turns over ₹366 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹3 left at the operating level before interest, tax and depreciation. Each of its 39 employees supports ₹9.37 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹9.37 Cr

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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?Little sign of one

Returns on capital of 7.6% 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.

Peer median ROE25.9%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +24% while net margin moved -27% 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+24%

Margin effect-27%

DalalBaazaar Score

47/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 7.5% — barely ahead of inflation
✗ Profit has declined at 3.0% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows

Quality vs. Valuation

Company Quality

39/ 100

Weak

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

Valuation

80/ 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

7.4x

Sector Median

69.2x

median of 4 sector peers

🟢Against its sector it trades 89% below the peer median of 69.2x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

69.2x median of 4 peers · -89%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

11.1x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.15x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 11.6% to 7.6% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 3 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 274% over 3 years, from ₹9 Cr to ₹32 Cr.
🔴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.
🔴Receivables growing faster than salesFinancial
Receivables up 121% against revenue up 24% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹5 Cr in the latest year.
🟡Margins are compressingFinancial
EBITDA margin is down 4.6 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 89% 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?

Margins are being competed away
EBITDA margin has fallen from 7.9% to 3.4%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 121% against revenue up 24%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Growth barely outpaces inflation
Revenue compounding at 7.5% 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.
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

1EBITDA margin holds above 1%✓ 3.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Free cash flow remains positive✗ -₹5 Cr
Profit that never becomes cash eventually stops being profit.
4Revenue growth stays above 6% a year✓ 7.5% CAGR
Latest reported year was 2.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5ROCE stays above 8%✗ 7.6%
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

₹117 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

7.4x

Cheap

Cheap against the generic band

P/B Ratio

0.54x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹5.43

Profitable

Profitable on a per-share basis

ROE

6.7%

Weak

Weak capital efficiency

ROCE

7.6%

Weak

Low return on total capital employed

Debt/Equity

0.15x

Low

Conservative leverage

Revenue Growth (YoY)

2.9%

Modest

Modest growth

Profit Growth (YoY)

89.3%

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

-₹5 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

0.3%

Weak

Thin margins leave little room for error

Net Margin

4.1%

Average

Average bottom-line conversion

Current Ratio

3.89

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.64

Defensive

Steadier than the market

52W Range Position

30%

Mid-range

Technical Snapshot

RSI (14)

46.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹294 Cr	₹458 Cr	₹491 Cr	₹366 Cr	+7.5%
EBITDA	₹23 Cr	₹21 Cr	₹23 Cr	₹12 Cr	-19.2%
EBITDA Margin	7.9%	4.5%	4.6%	3.4%	—
PAT (Net Profit)	₹16 Cr	₹12 Cr	₹13 Cr	₹14 Cr	-3.0%
EPS	₹5.39	₹4.14	₹4.5	₹4.92	-3.0%
ROE	8.9%	6.4%	6.5%	6.7%	—
ROCE	11.6%	9.3%	10.0%	7.6%	—
Total Debt	₹9 Cr	₹10 Cr	₹6 Cr	₹32 Cr	+55.2%
Free Cash Flow	₹88 Cr	-₹38 Cr	₹18 Cr	-₹5 Cr	—

🟢 Revenue has grown at 7.5% a year over 3 years.

🔴 EBITDA has shrunk at 19.2% a year over 3 years.

🔴 EBITDA Margin has fallen from 7.9% to 3.4% over 3 years (-4.6 pts).

🔴 PAT (Net Profit) has shrunk at 3.0% a year over 3 years.

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

🔴 ROE has fallen from 8.9% to 6.7% over 3 years (-2.2 pts).

🔴 ROCE has fallen from 11.6% to 7.6% over 3 years (-4.1 pts).

🔴 Total Debt has grown at 55.2% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹88 Cr to -₹5 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹262 Cr

Total Liabilities

₹46 Cr

Cash & Equivalents

₹12 Cr

Operating Cash Flow

-₹5 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

75.3%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

3 positive2 mixed1 negative

Lahoti Overseas Share Price fall: current levels and metrics

Univest, 24 SeptPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Lahoti Overseas (LAHOTIOV.NS) Ticks Up 0.78% to ₹41.46, Holding Above Key Support - Dividend Stock Picks

siam.in, 14 SeptCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Lahoti Overseas CFO Mahesh Mishra resigns over health issues

scanx.trade, 15 SeptManagement

🔴Potentially negativeA senior departure, and an auditor's resignation especially, is worth understanding before anything else in this report.

Lahoti Overseas Share Price Rises 12.65%: Stock Analysis

Univest, 20 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.

Dividend Stocks This Week: IRCTC, Dixon Technologies, Titagarh Rail Systems & More — Check Full List

NDTV Profit, 20 SeptCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Genus Prime Infra consolidated net profit rises 4933.33% in the June 2026 quarter

Business Standard, 11 AugResults

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

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingRisk

WeakBusiness Quality · Growth · Profitability

Points for each in the Score ↑

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. 3 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive; ROCE stays above 8% · see Key things to watch ↑