Mukand Limited

Basic Materials — Steel · NSE

₹172.00+₹1.65 (+0.97%)

DalalBaazaar Score

62 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by moderate debt load, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:10 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Mukand Limited engages in the manufacture and sale of alloy and stainless steel products in India and internationally. It operates through the Steel, Industrial Machinery and Engineering Contracts, and Others segments.

IndustrySteel

SectorBasic Materials

Employees1,379

Annual revenue₹4,846 Cr

How does it make money?

Turns over ₹4,846 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹4 left at the operating level before interest, tax and depreciation. Each of its 1,379 employees supports ₹3.51 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin3.5%

Net margin12.5%

Revenue / employee₹3.51 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, JINDAL STEEL LIMITED, STEEL AUTHORITY OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

TATA STEEL LIMITEDP/E 19.8x · ROE 10.8%

JSW STEEL LIMITEDP/E 12.0x · ROE 24.7%

JINDAL STEEL LIMITEDP/E 39.1x · ROE 5.3%

STEEL AUTHORITY OF INDIAP/E 16.5x · ROE 7.1%

What is its competitive advantage?Some evidence

ROCE of 35.6% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE35.6%

ROE39.7%

Peer median ROE10.8%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -13% while net margin moved +302% 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-13%

Margin effect+302%

DalalBaazaar Score

62/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.67 — 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
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

62/ 100

Average

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

Valuation

78/ 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

3.9x

3Y Median

16.6x

40 monthly readings · mean 17.7x · range 3.3x–27.1x

Sector Median

18.2x

median of 4 sector peers

🟢Current valuation is approximately 76% below its 3y median of 16.6x. 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 78% below the peer median of 18.2x.

vs. its own history

Cheap

16.6x median over 40 months · -76%

vs. sector peers

Cheap

18.2x median of 4 peers · -78%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

3.9x

P/B

1.63x

EV/EBITDA

24.3x

PEG

0.08

Dividend Yield

1.16%

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from -2.6% to 3.5% over 3 years.
Return on equity is rising
ROE has improved from 20.1% to 39.7%.
Return on capital is rising
ROCE has improved from 14.7% to 35.6%.
High return on capital employed
ROCE of 35.6% is the mark of a business that converts capital into profit efficiently.
Valuation below its historical average
At 3.9x the stock trades 76% below its own median of 16.6x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Inventory building faster than sales
Inventory is up 55% against revenue growth of -13% — stock may not be moving.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Inventory building faster than salesFinancial
Inventory up 55% against revenue up -13% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹549 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 35.6% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from -2.6% to 3.5%. 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 76% 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 78% 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 9.9x 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.
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

1EBITDA margin holds above 2%✓ 3.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 9.9x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹549 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 33%✓ 35.6%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Interest cover stays above 4x✓ 4.4x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

9 / 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

6 good · 4 neutral · 1 weak

Market Cap

₹2,485 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

3.9x

Cheap

Cheap against the generic band

P/B Ratio

1.63x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹43.77

Profitable

Profitable on a per-share basis

ROE

39.7%

Strong

Strong capital efficiency

ROCE

35.6%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.11x

Moderate

Moderate leverage

Revenue Growth (YoY)

20.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

97.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.16%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹549 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹172

Operating Margin

-0.8%

Weak

Thin margins leave little room for error

Net Margin

12.3%

Good

Strong bottom-line conversion

Current Ratio

1.39

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.67

Defensive

Steadier than the market

52W Range Position

76%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

168.0 / 149.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

54.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹5,546 Cr	₹5,155 Cr	₹4,874 Cr	₹4,846 Cr	-4.4%
EBITDA	-₹144 Cr	₹305 Cr	₹293 Cr	₹171 Cr	—
EBITDA Margin	-2.6%	5.9%	6.0%	3.5%	—
PAT (Net Profit)	₹172 Cr	₹104 Cr	₹76 Cr	₹604 Cr	+52.1%
EPS	₹11.89	₹7.19	₹5.24	₹41.81	+52.1%
ROE	20.1%	11.5%	8.0%	39.7%	—
ROCE	14.7%	10.8%	22.0%	35.6%	—
Total Debt	₹1,499 Cr	₹1,483 Cr	₹1,554 Cr	₹1,691 Cr	+4.1%
Free Cash Flow	₹45 Cr	₹28 Cr	₹54 Cr	-₹549 Cr	—

🔴 Revenue has shrunk at 4.4% a year over 3 years.

🟢 EBITDA has turned positive, from -₹144 Cr to ₹171 Cr.

🟢 EBITDA Margin has risen from -2.6% to 3.5% over 3 years (+6.1 pts).

🟢 PAT (Net Profit) has grown at 52.1% a year over 3 years.

🟢 EPS has grown at 52.1% a year over 3 years.

🟢 ROE has risen from 20.1% to 39.7% over 3 years (+19.6 pts).

🟢 ROCE has risen from 14.7% to 35.6% over 3 years (+20.8 pts).

🔴 Total Debt has grown at 4.1% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹45 Cr to -₹549 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,077 Cr

Total Liabilities

₹2,555 Cr

Total Debt

₹1,691 Cr

Cash & Equivalents

₹16 Cr

Operating Cash Flow

-₹441 Cr

Capex

-₹108 Cr

Shareholding (proxy)

Institutional Holding

1.0%

Insider Holding

77.5%

Corporate Actions

Dividend Rate

₹2

Ex-Dividend Date

07 Aug 2026

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
JINDAL STEEL LIMITED	39.1x	5.3%
STEEL AUTHORITY OF INDIA	16.5x	7.1%

Recent News

2 positive2 mixed2 general

Mukand Ltd. Share Price News: Today’s Rise and Valuation

Univest, 23 SeptPrice 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.

Mukand fixes Aug 7 record date for Rs 3 dividend

scanx.trade, 20 JulCapital return

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

Mukand Limited Approves A Dividend on Equity Shares for the Financial Year Ended March 31, 2026

marketscreener.com, 12 AugCapital return

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

Compare LLOYDS STEEL IND. with Mukand

Equitymaster, 10 Oct

Mukand Ltd. Share Price Update: Price, Valuation, Sector

Univest, 07 Oct

This smallcap steelmaker share skyrockets 19%; what's behind the rally?

Business Standard, 24 JulPrice 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.

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong13.9/20

🟡Financial HealthAdequate9.1/20

🟡GrowthModest10.5/20

🟢ProfitabilityStrong12.9/15

🟢ValuationAttractive11.8/15

🔴RiskHigh4/10

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

This thesis breaks if

✓EBITDA margin holds above 2%3.5%
✗Debt / EBITDA falls below 3x9.9x
✗Free cash flow remains positive-₹549 Cr
✓ROCE stays above 33%35.6%
✓Interest cover stays above 4x4.4x