Lime Chemicals Limited

Basic Materials — Specialty Chemicals · BSE

₹14.00+₹0.05 (+0.36%)

DalalBaazaar Score

26 / 100

🔴 Weak

Verdict

HIGH RISK

Risk

Very High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, 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 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, 6:59 pm

Understanding the Business

Company site ↗

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

What does this company do?

Lime Chemicals Limited manufactures and sells precipitated and coated calcium carbonate in India. It provides precipitated, activated, ground, and coated ground calcium carbonate, as well as quick lime, dolomite, and limestone.

IndustrySpecialty Chemicals

SectorBasic Materials

Annual revenue₹7 Cr

How does it make money?

Turns over ₹7 Cr a year. Of every ₹100 of sales, about ₹-2 reaches shareholders as profit, with ₹-1 left at the operating level before interest, tax and depreciation.

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?Little sign of one

Returns on capital of -6.7% 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.

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 -54% while net margin moved -114% 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-54%

Margin effect-114%

DalalBaazaar Score

26/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 22.8% a year

Quality vs. Valuation

Company Quality

25/ 100

Weak

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

Valuation

25/ 100

Expensive

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

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

350.0x

3Y Median

6.8x

40 monthly readings · mean 20.3x · range 3.2x–49.2x

Sector Median

40.4x

median of 4 sector peers

⚠️Current valuation is approximately 5019% above its 3y median of 6.8x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 767% above the peer median of 40.4x.

vs. its own history

Expensive

6.8x median over 40 months · +5019%

vs. sector peers

Expensive

40.4x median of 4 peers · +767%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

—

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 17% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 127.3% to -9.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 122.4% to -6.7% — often a sign of competition or overexpansion.

Red Flags

7 items require attention · 4 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 2.66x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only -4.5x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹0 Cr in the latest reported year.
🔴Inventory building faster than salesFinancial
Inventory up 251% against revenue up -54% — stock may not be moving.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.6x to -4.5x.
🟡Margins are compressingFinancial
EBITDA margin is down 2.8 points over 3 years.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.62 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 17% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 2.0% to -0.8%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 2.66x. Interest is payable whether or not the business has a good year.
The price already assumes success
The stock trades 5019% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 127.3% to -9.6%. 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.

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

1EBITDA margin holds above -3%✓ -0.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Interest cover stays above 3x✗ -4.5x
How much operating profit can fall before interest stops being comfortably covered.
3Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✗ -6.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 6.8x✗ 350.0x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

4 / 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

4 good · 2 neutral · 5 weak

Market Cap

₹9 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

350.0x

Expensive

Expensive — verify against sector peers

P/B Ratio

10.30x

Rich

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

EPS (TTM)

₹0.04

Profitable

Profitable on a per-share basis

ROE

-9.6%

Weak

Weak capital efficiency

ROCE

-6.7%

Weak

Low return on total capital employed

Debt/Equity

2.66x

High

High leverage

Revenue Growth (YoY)

236.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

675.0%

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

₹1 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

3.2%

Weak

Thin margins leave little room for error

Net Margin

-0.1%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.62

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.41

Defensive

Steadier than the market

52W Range Position

33%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

14.0 / 14.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

40.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹15 Cr	₹10 Cr	₹10 Cr	₹7 Cr	-22.8%
EBITDA	₹0 Cr	-₹0 Cr	₹0 Cr	-₹0 Cr	—
EBITDA Margin	2.0%	-3.2%	4.9%	-0.8%	—
PAT (Net Profit)	₹3 Cr	-₹0 Cr	₹0 Cr	-₹0 Cr	—
EPS	₹4.24	₹-0.76	₹0.34	₹-0.26	—
ROE	127.3%	-28.2%	11.4%	-9.6%	—
ROCE	122.4%	-23.3%	17.0%	-6.7%	—
Total Debt	₹6 Cr	₹5 Cr	₹5 Cr	₹5 Cr	-6.0%
Free Cash Flow	-₹3 Cr	₹0 Cr	-₹0 Cr	₹1 Cr	—

🔴 Revenue has shrunk at 22.8% a year over 3 years.

🔴 EBITDA has turned negative, from ₹0 Cr to -₹0 Cr.

🔴 EBITDA Margin has fallen from 2.0% to -0.8% over 3 years (-2.8 pts).

🔴 PAT (Net Profit) has turned negative, from ₹3 Cr to -₹0 Cr.

🔴 EPS has turned negative, from ₹4.24 to ₹-0.26.

🔴 ROE has fallen from 127.3% to -9.6% over 3 years (-136.9 pts).

🔴 ROCE has fallen from 122.4% to -6.7% over 3 years (-129.1 pts).

🟢 Total Debt has shrunk at 6.0% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹3 Cr to ₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹14 Cr

Total Liabilities

₹12 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹1 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

66.9%

Corporate Actions

Ex-Dividend Date

25 Sept 2006

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

Lime Chemicals promoter acquires 1,00,000 shares, stake rises to 12.15%

scanx.trade, 05 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.

Lime Chemicals Limited (BSE:LIMECHM): A Simple Guide to Its Business and Sector Position

Kalkine India, 14 Sept

U.S. Lime Market Size, Share & Growth, 2034

Market Data Forecast, 07 Oct

Compare LIME CHEM with

Equitymaster, 28 Sept

Chemicals for Acid Mine Drainage Neutralization Market

Future Market Insights, 12 May

SHIVAM CHEMICALS LIMITED Share Price

Upstox, 05 May

Watch Items

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

DalalBaazaar Thesis

MiddlingFinancial Health

WeakBusiness Quality · Growth · Profitability · Valuation · Risk

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 4 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Interest cover stays above 3x; ROCE stays above 8%; Valuation vs its own median of 6.8x · see Key things to watch ↑