Neeraj Paper Marketing Limited

Basic Materials — Paper & Paper Products · BSE

₹16.08₹0.00 (0.00%)

DalalBaazaar Score

44 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Whether sales start growing again 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 Neeraj Paper Marketing Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Neeraj Paper Marketing Limited engages in the marketing and trading of paper products in India.

IndustryPaper & Paper Products

SectorBasic Materials

Employees20

Annual revenue₹167 Cr

How does it make money?

Turns over ₹167 Cr a year. Of every ₹100 of sales, about ₹0 reaches shareholders as profit, with ₹1 left at the operating level before interest, tax and depreciation. Each of its 20 employees supports ₹8.36 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹8.36 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, ULTRATECH CEMENT LIMITED, ASIAN PAINTS 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 3.9% 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 ROE22.3%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -24% while net margin moved +31% 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-24%

Margin effect+31%

DalalBaazaar Score

44/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 8.7% a year
✗ Profit has declined at 0.0% a year

Quality vs. Valuation

Company Quality

37/ 100

Weak

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

Valuation

66/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

29.8x

3Y Median

42.8x

40 monthly readings · mean 54.3x · range 29.6x–95.5x

Sector Median

28.7x

median of 4 sector peers

🟢Current valuation is approximately 30% below its 3y median of 42.8x. 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 is priced broadly in line with the peer median of 28.7x.

vs. its own history

Cheap

42.8x median over 40 months · -30%

vs. sector peers

Fair

28.7x median of 4 peers · +4%

vs. generic bands

Fair

15x–35x

EV/EBITDA

15.4x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 69% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 7.5% to 3.9% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 high

🔴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.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 69% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Priced below its own history
The stock trades 30% 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.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹8 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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 5.1x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
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 -1%✓ 1.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 5.1x
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✗ 2.2x
How much operating profit can fall before interest stops being comfortably covered.
4Free cash flow remains positive✓ ₹8 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ 3.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 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

₹18 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

29.8x

Fair

Fairly valued against the generic band

P/B Ratio

0.63x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.54

Profitable

Profitable on a per-share basis

ROE

1.8%

Weak

Weak capital efficiency

ROCE

3.9%

Weak

Low return on total capital employed

Debt/Equity

0.34x

Low

Conservative leverage

Revenue Growth (YoY)

-2.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

87.5%

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

₹8 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

0.8%

Weak

Thin margins leave little room for error

Net Margin

0.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.80

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.17

Defensive

Steadier than the market

52W Range Position

14%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

17.2 / 18.7

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

11.0

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹220 Cr	₹158 Cr	₹197 Cr	₹167 Cr	-8.7%
EBITDA	₹3 Cr	₹3 Cr	₹3 Cr	₹2 Cr	-19.8%
EBITDA Margin	1.4%	2.2%	1.6%	1.0%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹0 Cr	₹1 Cr	-0.0%
EPS	₹0.47	₹0.52	₹0.22	₹0.47	+0.0%
ROE	1.9%	2.1%	0.9%	1.8%	—
ROCE	7.5%	8.9%	8.1%	3.9%	—
Total Debt	₹27 Cr	₹26 Cr	₹15 Cr	₹8 Cr	-32.7%
Free Cash Flow	-₹2 Cr	₹4 Cr	₹13 Cr	₹8 Cr	—

🔴 Revenue has shrunk at 8.7% a year over 3 years.

🔴 EBITDA has shrunk at 19.8% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 1.0% over 3 years.

🟡 PAT (Net Profit) has been broadly flat over 3 years (-0.0% a year).

🟡 EPS has been broadly flat over 3 years (0.0% a year).

🟡 ROE has held roughly flat at 1.8% over 3 years.

🔴 ROCE has fallen from 7.5% to 3.9% over 3 years (-3.6 pts).

🟢 Total Debt has shrunk at 32.7% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹2 Cr to ₹8 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹62 Cr

Total Liabilities

₹34 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹8 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

81.1%

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
ULTRATECH CEMENT LIMITED	37.6x	11.1%
ASIAN PAINTS LIMITED	46.9x	22.3%

Recent News

1 positive1 negative4 general

Neeraj Paper Marketing Ltd Downgraded to Strong Sell Amid Deteriorating Technicals and Weak Financial Trends

MarketsMojo, 15 OctAnalyst view

🔴Potentially negativeAn analyst opinion changing, which moves the price without changing the business.

Neeraj Paper Marketing Ltd. Peer Comparison – Compare with Others

Value Research, 01 Sept

Compare with

Equitymaster, 09 Oct

Neeraj Paper Q1 Results: Net profit rises 81% YoY to ₹16.06 lakh

scanx.trade, 13 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Neeraj Paper Marketing Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 29 Aug

Compare with

Equitymaster, 30 Sept

Watch Items

Revenue growth is negative (-2.3%) 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.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingRisk

WeakBusiness Quality · Growth · Profitability

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 1 high-severity red flag sits above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑