Mefcom Capital Markets Limited

Financial Services — Capital Markets · BSE

₹11.95+₹0.55 (+4.82%)

DalalBaazaar Score

53 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, the company is currently loss-making, micro-cap size, which brings thin liquidity.

In simple words: The company is currently losing money, 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 Mefcom Capital Markets Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Mefcom Capital Markets Limited engages in the capital market operations and merchant banking activities in India. The company operates through Trading in Shares & Securities and Merchant Banking Service.

IndustryCapital Markets

SectorFinancial Services

Employees19

Annual revenue₹114 Cr

How does it make money?

Turns over ₹114 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. Each of its 19 employees supports ₹6.00 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹6.00 Cr

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC LIFE INS CO LTD, SBI LIFE INSURANCE CO 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?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE13.7%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +72% while net margin moved -77% 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+72%

Margin effect-77%

DalalBaazaar Score

53/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✓ ROE has improved by 31.5 points over the period

Quality vs. Valuation

Company Quality

58/ 100

Average

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

Valuation

29/ 100

Expensive

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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

—

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from -7.1% to -1.0% over 3 years.
Return on equity is rising
ROE has improved from -44.3% to -12.9%.
Return on capital is rising
ROCE has improved from -33.2% to -6.6%.

🔴 What Needs Attention2

Receivables growing faster than sales
Receivables are up 264% against revenue growth of 72% — customers are taking longer to pay.
Inventory building faster than sales
Inventory is up 155% against revenue growth of 72% — stock may not be moving.

Red Flags

2 items require attention · 2 high

🔴Thin interest coverageFinancial
Operating profit covers interest only -1.2x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹2 Cr in the latest reported year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -7.1% to -1.0%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

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.
Several serious flags at once
2 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

1Revenue growth stays above 15% a year✓ 19.8% CAGR
Latest reported year was 2.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above -3%✓ -1.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 8%✗ -0.3%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Interest cover stays above 3x✗ -1.2x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

7 / 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

2 good · 4 neutral · 5 weak

Market Cap

₹55 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

2.23x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹-101.05

Loss-making

Negative earnings per share — the business is losing money

ROE

-0.3%

Weak

Weak capital efficiency

ROCE

-6.6%

Weak

Low return on total capital employed

Debt/Equity

0.57x

Low

Conservative leverage

Revenue Growth (YoY)

2.1%

Modest

Modest growth

Profit Growth (YoY)

34.5%

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

-₹12 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

-0.2%

Weak

Assets generate little profit

Operating Margin

14.5%

Average

Average margins

Net Margin

-0.3%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.41

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.40

Defensive

Steadier than the market

52W Range Position

43%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

11.5 / 11.2

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

54.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹66 Cr	₹233 Cr	₹221 Cr	₹114 Cr	+19.8%
EBITDA	-₹5 Cr	₹9 Cr	-₹2 Cr	-₹1 Cr	—
EBITDA Margin	-7.1%	4.0%	-0.7%	-1.0%	—
PAT (Net Profit)	-₹5 Cr	₹8 Cr	-₹2 Cr	-₹2 Cr	—
EPS	₹-1.17	₹1.7	₹-0.52	₹-0.46	—
ROE	-44.3%	35.3%	-12.4%	-12.9%	—
ROCE	-33.2%	38.1%	-8.2%	-6.6%	—
Total Debt	₹6 Cr	₹1 Cr	₹8 Cr	₹20 Cr	+45.7%
Free Cash Flow	₹0 Cr	₹3 Cr	-₹8 Cr	-₹12 Cr	—

🟢 Revenue has grown at 19.8% a year over 3 years.

🟢 EBITDA Margin has risen from -7.1% to -1.0% over 3 years (+6.1 pts).

🟢 ROE has risen from -44.3% to -12.9% over 3 years (+31.5 pts).

🟢 ROCE has risen from -33.2% to -6.6% over 3 years (+26.5 pts).

🔴 Total Debt has grown at 45.7% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹0 Cr to -₹12 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹39 Cr

Total Liabilities

₹21 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹12 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.5%

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC LIFE INS CO LTD	58.4x	11.3%
SBI LIFE INSURANCE CO LTD	63.9x	13.7%

Recent News

1 mixed5 general

Mefcom Capital Markets Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 04 Sept

Mefcom Capital Markets narrows net loss to ₹185.13 lakh in FY26

scanx.trade, 17 Jul

Weak Start! Annu Projects shares list at 27% discount to IPO price

The Economic Times, 02 Sept

Rays of Belief IPO: Analysts see growth potential but flag execution risks

Business Standard, 01 SeptAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Mefcom Capital Markets Limited Responds to BSE Inquiry on Share Price Movement

scanx.trade, 15 Apr

Priority Jewels make a decent stock market debut; shares list at 15% premium on NSE

Business Today, 04 Sept

Watch Items

This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Growth

WeakBusiness Quality · Profitability · Valuation · Risk

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

2 of 4 tripwires tripped — Return on equity stays above 8%; Interest cover stays above 3x · see Key things to watch ↑