Mafatlal Industries Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹111.61−₹0.83 (−0.74%)

DalalBaazaar Score

62 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Reasonable but unspectacular business quality, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 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 Mafatlal Industries Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Mafatlal Industries Limited manufactures and trades in textiles in India, rest of Asia, and internationally. The company operates through Textile and Related Products, Digital Infrastructure, and Consumer Durables and Others segments.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees1,060

Annual revenue₹3,844 Cr

How does it make money?

Turns over ₹3,844 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹4 left at the operating level before interest, tax and depreciation. Each of its 1,060 employees supports ₹3.63 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin3.7%

Net margin2.3%

Revenue / employee₹3.63 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.

MARUTI SUZUKI INDIA LTD.P/E 25.2x · ROE 13.4%

TITAN COMPANY LIMITEDP/E 68.5x · ROE 36.7%

TRENT LTDP/E 87.2x · ROE 25.9%

AVENUE SUPERMARTS LIMITEDP/E 69.9x · ROE 12.7%

What is its competitive advantage?Little sign of one

Returns on capital of 12.2% 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.

ROCE12.2%

ROE11.7%

Peer median ROE25.9%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +181% while net margin moved -14% 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+181%

Margin effect-14%

DalalBaazaar Score

62/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of -0.04 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings

Quality vs. Valuation

Company Quality

60/ 100

Average

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

Valuation

87/ 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

14.0x

Sector Median

69.2x

median of 4 sector peers

🟢Against its sector it trades 80% 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 · -80%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

14.0x

P/B

1.04x

EV/EBITDA

5.2x

PEG

0.41

Dividend Yield

2.24%

What's Good / What's Bad

🟢 What's Going Well5

Debt is being paid down
Total debt is down 33% 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 6.1% to 11.7%.
Return on capital is rising
ROCE has improved from 8.3% to 12.2%.
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

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 8.24x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 33% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 80% 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?

Leverage amplifies any setback
Debt/Equity of 8.24x. Interest is payable whether or not the business has a good year.
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 31% a year✓ 41.2% CAGR
Latest reported year was -24.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 2%✓ 3.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹115 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 9%✓ 12.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

5 good · 3 neutral · 3 weak

Market Cap

₹806 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

14.0x

Cheap

Cheap against the generic band

P/B Ratio

1.04x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹8

Profitable

Profitable on a per-share basis

ROE

11.7%

Moderate

Moderate capital efficiency

ROCE

12.2%

Moderate

Moderate return on the capital in the business

Debt/Equity

8.24x

High

High leverage

Revenue Growth (YoY)

-24.0%

Shrinking

Sales are contracting

Profit Growth (YoY)

-67.9%

Falling

Profits are shrinking

Dividend Yield

2.24%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹115 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹111.61

Operating Margin

1.5%

Weak

Thin margins leave little room for error

Net Margin

1.7%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.25

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.04

Defensive

Steadier than the market

52W Range Position

10%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

115.3 / 120.1

Bearish alignment (short < long)

RSI (14)

40.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,367 Cr	₹2,069 Cr	₹2,801 Cr	₹3,844 Cr	+41.2%
EBITDA	₹56 Cr	₹77 Cr	₹104 Cr	₹143 Cr	+36.6%
EBITDA Margin	4.1%	3.7%	3.7%	3.7%	—
PAT (Net Profit)	₹37 Cr	₹99 Cr	₹98 Cr	₹90 Cr	+34.3%
EPS	₹5.22	₹13.75	₹13.58	₹12.46	+33.6%
ROE	6.1%	12.1%	13.2%	11.7%	—
ROCE	8.3%	10.4%	10.4%	12.2%	—
Total Debt	₹94 Cr	₹82 Cr	₹70 Cr	₹64 Cr	-12.3%
Free Cash Flow	-₹22 Cr	₹153 Cr	-₹97 Cr	₹115 Cr	—

🟢 Revenue has grown at 41.2% a year over 3 years.

🟢 EBITDA has grown at 36.6% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 3.7% over 3 years.

🟢 PAT (Net Profit) has grown at 34.3% a year over 3 years.

🟢 EPS has grown at 33.6% a year over 3 years.

🟢 ROE has risen from 6.1% to 11.7% over 3 years (+5.6 pts).

🟢 ROCE has risen from 8.3% to 12.2% over 3 years (+3.9 pts).

🟢 Total Debt has shrunk at 12.3% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹22 Cr to ₹115 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,750 Cr

Total Liabilities

₹979 Cr

Total Debt

₹64 Cr

Cash & Equivalents

₹124 Cr

Operating Cash Flow

₹141 Cr

Capex

-₹26 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

76.0%

Corporate Actions

Dividend Rate

₹2.5

Ex-Dividend Date

31 Jul 2026

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

2 positive1 negative3 general

Mafatlal Industries signs MoU to supply combat uniform fabric

scanx.trade, 16 Oct

Mafatlal Industries Share Price Near Yearly Low; Sector View

Univest, 05 Oct

Mafatlal Industries receives order worth Rs 114 cr

Business Standard, 17 MarOrder win

🟢Potentially positiveAn order or contract win, which adds to future revenue. How much depends on its size against annual sales and on when it is executed.

Mafatlal Industries vs Mayur Uniquoters vs Jindal Worldwide: Which Stock Should You Track

Univest, 05 Oct

Mafatlal Industries Secures ₹114 Crore Order for Robotic Labs in Odisha

scanx.trade, 17 MarOrder win

🟢Potentially positiveAn order or contract win, which adds to future revenue. How much depends on its size against annual sales and on when it is executed.

Mafatlal Industries consolidated net profit declines 67.88% in the June 2026 quarter

Business Standard, 07 AugResults

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

Watch Items

Revenue growth is negative (-24.0%) 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 QualityAdequate10.2/20

🟢Financial HealthStrong13.5/20

🟡GrowthModest12.9/20

🟡ProfitabilityModerate8.5/15

🟢ValuationAttractive12.6/15

🔴RiskHigh4.3/10

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 31% a year41.2% CAGR
✓EBITDA margin holds above 2%3.7%
✓Free cash flow remains positive₹115 Cr
✓Debt / EBITDA stays below 2x0.4x
✓ROCE stays above 9%12.2%