LWS Knitwear Limited

Consumer Cyclical — Apparel Manufacturing · BSE

₹13.60+₹0.11 (+0.82%)

DalalBaazaar Score

63 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

Driven by 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. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:49 pm

Understanding the Business

Company site ↗

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

What does this company do?

LWS Knitwear Limited manufactures and sells knitted clothes, hosiery goods and readymade garments in India.

IndustryApparel Manufacturing

SectorConsumer Cyclical

Annual revenue₹96 Cr

How does it make money?

Turns over ₹96 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹6 left at the operating level before interest, tax and depreciation.

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 12.6% 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?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +54% while net margin moved +427% 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+427%

DalalBaazaar Score

63/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.26 — 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

Quality vs. Valuation

Company Quality

60/ 100

Average

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 reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

8.7x

3Y Median

12.6x

40 monthly readings · mean 36.2x · range 8.0x–155.5x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 31% below its 3y median of 12.6x. 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 87% below the peer median of 69.2x.

vs. its own history

Cheap

12.6x median over 40 months · -31%

vs. sector peers

Cheap

69.2x median of 4 peers · -87%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

6.5x

PEG

0.09

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 1.9% to 5.6% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from 2.7% to 7.3%.
Return on capital is rising
ROCE has improved from 5.2% to 12.6%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Inventory building faster than salesFinancial
Inventory up 123% against revenue up 54% — stock may not be moving.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 60% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 1.9% to 5.6%. 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 31% 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 87% 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?

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.
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✓ 15.4% CAGR
Latest reported year was -5.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 4%✓ 5.6%
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.
4Interest cover stays above 3x✗ 2.5x
How much operating profit can fall before interest stops being comfortably covered.
5Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

5 / 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 · 3 neutral · 3 weak

Market Cap

₹20 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

8.7x

Cheap

Cheap against the generic band

P/B Ratio

0.60x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹1.56

Profitable

Profitable on a per-share basis

ROE

7.3%

Weak

Weak capital efficiency

ROCE

12.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.55x

Low

Conservative leverage

Revenue Growth (YoY)

-5.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

-36.8%

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

₹1 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

5.4%

Average

Average margins

Net Margin

2.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

4.13

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.26

Defensive

Steadier than the market

52W Range Position

16%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

14.8 / 15.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

52.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹63 Cr	₹75 Cr	₹109 Cr	₹96 Cr	+15.4%
EBITDA	₹1 Cr	₹3 Cr	₹5 Cr	₹5 Cr	+65.2%
EBITDA Margin	1.9%	4.3%	4.6%	5.6%	—
PAT (Net Profit)	₹0 Cr	₹1 Cr	₹3 Cr	₹2 Cr	+100.8%
EPS	₹0.32	₹1.53	₹1.73	₹1.63	+71.9%
ROE	2.7%	11.5%	8.3%	7.3%	—
ROCE	5.2%	11.9%	12.8%	12.6%	—
Total Debt	₹16 Cr	₹19 Cr	₹14 Cr	₹18 Cr	+3.8%
Free Cash Flow	-₹6 Cr	-₹9 Cr	-₹9 Cr	₹1 Cr	—

🟢 Revenue has grown at 15.4% a year over 3 years.

🟢 EBITDA has grown at 65.2% a year over 3 years.

🟢 EBITDA Margin has risen from 1.9% to 5.6% over 3 years (+3.7 pts).

🟢 PAT (Net Profit) has grown at 100.8% a year over 3 years.

🟢 EPS has grown at 71.9% a year over 3 years.

🟢 ROE has risen from 2.7% to 7.3% over 3 years (+4.6 pts).

🟢 ROCE has risen from 5.2% to 12.6% over 3 years (+7.4 pts).

🔴 Total Debt has grown at 3.8% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹6 Cr to ₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹56 Cr

Total Liabilities

₹23 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹1 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

70.8%

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

1 mixed1 negative4 general

LWS Knitwear Ltd. Financials – Balance Sheet, Profit & Loss, Cash Flow

Value Research, 11 Sept

LWS Knitwear promoters sell 3.7 lakh shares in open market

scanx.trade, 05 Sept

LWS Knitwear standalone net profit declines 33.33% in the June 2026 quarter

Business Standard, 15 AugResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

LWS Knitwear EGM Results: Share Capital Increase Approved with 100% Votes

scanx.trade, 23 MarResults

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

LWS KNITWEAR LTD. Share Price

Upstox, 18 Aug

PRASHANT INDIA LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 06 Dec

Watch Items

Revenue growth is negative (-5.3%) 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

StrongFinancial Health · Growth · Valuation

MiddlingBusiness Quality · Profitability

WeakRisk

Points for each in the Score ↑

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.

2 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x · see Key things to watch ↑