Magadh Sugar & Energy Limited

Consumer Defensive — Confectioners · NSE

₹603.00+₹21.85 (+3.76%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

CAUTION

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, 7:01 pm

Understanding the Business

Company site ↗

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

What does this company do?

Magadh Sugar & Energy Limited manufactures and sells sugar and its by-products in India and internationally. It operates in three segments: Sugar, Distillery, and Co-Generation.

IndustryConfectioners

SectorConsumer Defensive

Employees1,152

Annual revenue₹1,239 Cr

How does it make money?

Turns over ₹1,239 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 1,152 employees supports ₹1.08 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.08 Cr

Who are its competitors?

The closest listed comparisons in its industry are HINDUSTAN UNILEVER LTD., ITC LTD, NESTLE INDIA LIMITED, BRITANNIA INDUSTRIES LTD. 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 10.7% 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 ROE51.0%

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 +30% while net margin moved -3% 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+30%

Margin effect-3%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 7.2% is weak

Quality vs. Valuation

Company Quality

53/ 100

Average

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

Valuation

58/ 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

16.6x

3Y Median

8.9x

40 monthly readings · mean 11.4x · range 5.6x–22.3x

Sector Median

43.3x

median of 4 sector peers

⚠️Current valuation is approximately 88% above its 3y median of 8.9x. 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 62% below the peer median of 43.3x.

vs. its own history

Expensive

8.9x median over 40 months · +88%

vs. sector peers

Cheap

43.3x median of 4 peers · -62%

vs. generic bands

Fair

15x–35x

EV/EBITDA

10.2x

PEG

2.05

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Margins are compressing
EBITDA margin has slipped from 14.0% to 12.2% over 3 years.
Return on capital is falling
ROCE has declined from 13.2% to 10.7% — often a sign of competition or overexpansion.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 62% 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 14.0% to 12.2%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.6x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 88% 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.
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

1EBITDA margin holds above 10%✓ 12.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.6x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✓ 3.4x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 7% a year✓ 9.2% CAGR
Latest reported year was -6.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹63 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

4 good · 4 neutral · 3 weak

Market Cap

₹850 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

16.6x

Fair

Fairly valued against the generic band

P/B Ratio

0.97x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹36.24

Profitable

Profitable on a per-share basis

ROE

7.2%

Weak

Weak capital efficiency

ROCE

10.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.79x

Moderate

Moderate leverage

Revenue Growth (YoY)

-6.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

-42.0%

Falling

Profits are shrinking

Dividend Yield

2.07%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹63 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

-2.3%

Weak

Thin margins leave little room for error

Net Margin

4.2%

Average

Average bottom-line conversion

Current Ratio

1.25

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.02

Defensive

Steadier than the market

52W Range Position

85%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

544.4 / 551.8

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

61.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹950 Cr	₹1,094 Cr	₹1,292 Cr	₹1,239 Cr	+9.2%
EBITDA	₹133 Cr	₹216 Cr	₹215 Cr	₹151 Cr	+4.2%
EBITDA Margin	14.0%	19.7%	16.6%	12.2%	—
PAT (Net Profit)	₹50 Cr	₹116 Cr	₹109 Cr	₹64 Cr	+8.1%
EPS	₹35.67	₹82.61	₹77.67	₹45.07	+8.1%
ROE	7.9%	15.6%	13.1%	7.2%	—
ROCE	13.2%	21.8%	17.5%	10.7%	—
Total Debt	₹583 Cr	₹637 Cr	₹707 Cr	₹691 Cr	+5.9%
Free Cash Flow	₹93 Cr	-₹17 Cr	-₹13 Cr	₹63 Cr	-12.2%

🟢 Revenue has grown at 9.2% a year over 3 years.

🟢 EBITDA has grown at 4.2% a year over 3 years.

🔴 EBITDA Margin has fallen from 14.0% to 12.2% over 3 years (-1.8 pts).

🟢 PAT (Net Profit) has grown at 8.1% a year over 3 years.

🟢 EPS has grown at 8.1% a year over 3 years.

🟡 ROE has held roughly flat at 7.2% over 3 years.

🔴 ROCE has fallen from 13.2% to 10.7% over 3 years (-2.5 pts).

🔴 Total Debt has grown at 5.9% a year over 3 years.

🔴 Free Cash Flow has shrunk at 12.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,680 Cr

Total Liabilities

₹800 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹148 Cr

Capex

-₹86 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

83.0%

Corporate Actions

Dividend Rate

₹12.5

Ex-Dividend Date

17 Jul 2026

Peer Comparison

Company	P/E	ROE
HINDUSTAN UNILEVER LTD.	42.5x	21.5%
ITC LTD	16.6x	27.4%
NESTLE INDIA LIMITED	59.8x	79.9%
BRITANNIA INDUSTRIES LTD	44.1x	51.0%

Recent News

3 positive3 general

Here's What We Like About Magadh Sugar & Energy's (NSE:MAGADSUGAR) Upcoming Dividend

Simply Wall Street, 13 JulCapital return

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

Magadh Sugar shareholders approve dividend and board changes

scanx.trade, 29 JulCapital return

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

Magadh Sugar final dividend: Ex- Date tomorrow; Rs 12.50 per share payout due

Moneycontrol.com, 16 JulCapital return

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

Magadh Sugar & Energy Share Price update after 9.24% gain

Univest, 25 Sept

Own Vodafone Idea, Sky Gold or Magadh Sugar shares? Here’s what expert suggests

Business Today, 14 May

Top 3 Sugar Stocks Down Up to 38% From 52-week Highs

Equitymaster, 13 Apr

Watch Items

Revenue growth is negative (-6.8%) 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

StrongFinancial Health

MiddlingBusiness Quality · Growth · Valuation · Risk

WeakProfitability

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 of 5 tripwires tripped — Debt / EBITDA falls below 3x · see Key things to watch ↑