Nitin Castings Limited

Industrials — Metal Fabrication · BSE

₹439.00+₹20.90 (+5.00%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, falling profits.

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:06 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 Nitin Castings Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Nitin Castings Limited manufactures, sells, and exports alloy steel castings in India and internationally. It offers centrifugal, sand, shell-molded, and investment castings.

IndustryMetal Fabrication

SectorIndustrials

Employees267

Annual revenue₹147 Cr

How does it make money?

Turns over ₹147 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹10 left at the operating level before interest, tax and depreciation. Each of its 267 employees supports ₹55.1 lakh of revenue a year, the signature of a people-led business.

EBITDA margin10.4%

Net margin7.2%

Revenue / employee₹55.1 lakh

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, HINDALCO INDUSTRIES LTD, VEDANTA LIMITED. 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%

HINDALCO INDUSTRIES LTDP/E 12.3x · ROE 12.0%

VEDANTA LIMITEDP/E 10.4x · ROE 18.7%

What is its competitive advantage?Little sign of one

Returns on capital of 14.8% 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.

ROCE14.8%

ROE11.6%

Peer median ROE18.7%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +10% while net margin moved +97% 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+10%

Margin effect+97%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of -0.48 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

59/ 100

Average

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

Valuation

49/ 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

29.7x

3Y Median

27.6x

40 monthly readings · mean 36.0x · range 15.9x–90.4x

Sector Median

12.2x

median of 4 sector peers

🟡Currently trading close to its 3y median of 27.6x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 144% above the peer median of 12.2x.

vs. its own history

Fair

27.6x median over 40 months · +8%

vs. sector peers

Expensive

12.2x median of 4 peers · +144%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

29.7x

P/B

2.46x

EV/EBITDA

15.6x

PEG

1.01

Dividend Yield

0.68%

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 8.4% to 10.4% over 3 years.
Return on equity is rising
ROE has improved from 8.2% to 11.6%.
Very low debt
Debt/Equity of 0.15x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Debt is rising
Total debt is up 41% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Receivables growing faster than sales
Receivables are up 60% against revenue growth of 10% — customers are taking longer to pay.

Red Flags

3 items require attention · 1 high · 2 watch

🔴Receivables growing faster than salesFinancial
Receivables up 60% against revenue up 10% — sales are being booked faster than they are collected.
🟡Debt is increasingFinancial
Total debt is up 41% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹1 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 8.4% to 10.4%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

Sales are being booked faster than collected
Receivables are up 60% against revenue up 10%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 144% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 3.3% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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 8%✓ 10.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹1 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 4% a year✗ 3.3% CAGR
Latest reported year was -23.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 0.9x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 12%✓ 14.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

2 good · 6 neutral · 3 weak

Market Cap

₹226 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

29.7x

Fair

Fairly valued against the generic band

P/B Ratio

2.46x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹14.78

Profitable

Profitable on a per-share basis

ROE

11.6%

Moderate

Moderate capital efficiency

ROCE

14.8%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.15x

Low

Conservative leverage

Revenue Growth (YoY)

-23.2%

Shrinking

Sales are contracting

Profit Growth (YoY)

-53.2%

Falling

Profits are shrinking

Dividend Yield

0.68%

Modest

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

Free Cash Flow

-₹1 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹439

Operating Margin

3.8%

Weak

Thin margins leave little room for error

Net Margin

5.5%

Average

Average bottom-line conversion

Current Ratio

2.38

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.48

Defensive

Steadier than the market

52W Range Position

46%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

453.0 / 407.6

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

41.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹133 Cr	₹149 Cr	₹151 Cr	₹147 Cr	+3.3%
EBITDA	₹11 Cr	₹15 Cr	₹17 Cr	₹15 Cr	+11.2%
EBITDA Margin	8.4%	10.3%	11.2%	10.4%	—
PAT (Net Profit)	₹5 Cr	₹12 Cr	₹12 Cr	₹11 Cr	+29.5%
EPS	₹9.51	₹23.59	₹24.14	₹20.67	+29.5%
ROE	8.2%	16.9%	15.0%	11.6%	—
ROCE	14.0%	20.5%	19.8%	14.8%	—
Total Debt	₹10 Cr	₹5 Cr	₹7 Cr	₹14 Cr	+12.2%
Free Cash Flow	₹1 Cr	₹12 Cr	₹9 Cr	-₹1 Cr	—

🟢 Revenue has grown at 3.3% a year over 3 years.

🟢 EBITDA has grown at 11.2% a year over 3 years.

🟢 EBITDA Margin has risen from 8.4% to 10.4% over 3 years (+2.1 pts).

🟢 PAT (Net Profit) has grown at 29.5% a year over 3 years.

🟢 EPS has grown at 29.5% a year over 3 years.

🟢 ROE has risen from 8.2% to 11.6% over 3 years (+3.4 pts).

🟡 ROCE has held roughly flat at 14.8% over 3 years.

🔴 Total Debt has grown at 12.2% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹1 Cr to -₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹140 Cr

Total Liabilities

₹49 Cr

Total Debt

₹14 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹9 Cr

Capex

-₹11 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

89.4%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

25 Aug 2025

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
HINDALCO INDUSTRIES LTD	12.3x	12.0%
VEDANTA LIMITED	10.4x	18.7%

Recent News

6 general

Nitin Castings Upper Circuit Today: Price, Data and Peers

Univest, 16 Oct

Nitin Castings delisting offer fails as promoters reject ₹300 price

scanx.trade, 12 Aug

Nitin Castings Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 06 Oct

Nitin Castings IDC backs ₹273.36 delisting offer for public shareholders

scanx.trade, 27 Jul

Nitin Castings Ltd. Lower Circuit Streak: Day 2 Price and Data

Univest, 29 Sept

Nitin Castings Ltd. Peer Comparison – Compare with Others

Value Research, 04 Sept

Watch Items

Revenue growth is negative (-23.2%) 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 QualityAdequate9/20

🟢Financial HealthStrong14.5/20

🟡GrowthModest11.3/20

🟡ProfitabilityModerate9.6/15

🟡ValuationFair8.1/15

🔴RiskHigh4.4/10

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

✓EBITDA margin holds above 8%10.4%
✗Free cash flow remains positive-₹1 Cr
✗Revenue growth stays above 4% a year3.3% CAGR
✓Debt / EBITDA stays below 2x0.9x
✓ROCE stays above 12%14.8%