Prakash Pipes Limited

Industrials — Building Products & Equipment · NSE

₹239.00+₹1.05 (+0.44%)

DalalBaazaar Score

45 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:05 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 Prakash Pipes Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Prakash Pipes Limited engages in the manufacture and sale of PVC pipes, fittings, and flexible packaging solutions in India and internationally.

IndustryBuilding Products & Equipment

SectorIndustrials

Employees568

Annual revenue₹789 Cr

How does it make money?

Turns over ₹789 Cr a year. Of every ₹100 of sales, about ₹5 reaches shareholders as profit, with ₹10 left at the operating level before interest, tax and depreciation. Each of its 568 employees supports ₹1.39 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin9.5%

Net margin5.5%

Revenue / employee₹1.39 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

What is its competitive advantage?Little sign of one

Returns on capital of 12.6% 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.

ROCE12.6%

ROE9.0%

Peer median ROE15.2%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +11% while net margin moved -45% 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+11%

Margin effect-45%

DalalBaazaar Score

45/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 3.6% — barely ahead of inflation
✗ Profit has declined at 15.3% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows

Quality vs. Valuation

Company Quality

38/ 100

Weak

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

Valuation

80/ 100

Cheap

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

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

11.6x

3Y Median

11.4x

40 monthly readings · mean 11.1x · range 4.7x–17.2x

Sector Median

88.8x

median of 3 sector peers

🟡Currently trading close to its 3y median of 11.4x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 87% below the peer median of 88.8x.

vs. its own history

Fair

11.4x median over 40 months · +2%

vs. sector peers

Cheap

88.8x median of 3 peers · -87%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

11.6x

P/B

1.19x

EV/EBITDA

7.6x

PEG

—

Dividend Yield

1.42%

What's Good / What's Bad

🟢 What's Going Well1

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

🔴 What Needs Attention6

Margins are compressing
EBITDA margin has slipped from 12.5% to 9.5% over 3 years.
Debt is rising
Total debt is up 100% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 25.6% to 9.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 32.8% to 12.6% — often a sign of competition or overexpansion.
Inventory building faster than sales
Inventory is up 72% against revenue growth of 11% — stock may not be moving.

Red Flags

6 items require attention · 3 high · 3 watch

🔴Debt has risen sharplyFinancial
Total debt is up 100% over 3 years, from ₹10 Cr to ₹19 Cr.
🔴High leverageFinancial
Debt/Equity of 4.00x — earnings must service borrowings before shareholders see anything.
🔴Inventory building faster than salesFinancial
Inventory up 72% against revenue up 11% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹4 Cr in the latest year.
🟡Profit is decliningFinancial
Net profit is down 39% over 3 years.
🟡Margins are compressingFinancial
EBITDA margin is down 3.0 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 87% 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 12.5% to 9.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 4.00x. Interest is payable whether or not the business has a good year.
Growth barely outpaces inflation
Revenue compounding at 3.6% 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.
Returns on shareholder capital are falling
ROE has dropped from 25.6% to 9.0%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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%✓ 9.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹4 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 4% a year✗ 3.6% CAGR
Latest reported year was 18.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 10%✓ 12.6%
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

5 good · 4 neutral · 2 weak

Market Cap

₹572 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

11.6x

Cheap

Cheap against the generic band

P/B Ratio

1.19x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹20.65

Profitable

Profitable on a per-share basis

ROE

9.0%

Moderate

Moderate capital efficiency

ROCE

12.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

4.00x

High

High leverage

Revenue Growth (YoY)

18.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

59.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.42%

Modest

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

Free Cash Flow

-₹4 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹239

Operating Margin

5.9%

Average

Average margins

Net Margin

6.0%

Average

Average bottom-line conversion

Current Ratio

2.11

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.06

Defensive

Steadier than the market

52W Range Position

44%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

253.5 / 262.6

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

30.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹709 Cr	₹669 Cr	₹780 Cr	₹789 Cr	+3.6%
EBITDA	₹89 Cr	₹110 Cr	₹129 Cr	₹75 Cr	-5.3%
EBITDA Margin	12.5%	16.5%	16.6%	9.5%	—
PAT (Net Profit)	₹71 Cr	₹90 Cr	₹83 Cr	₹43 Cr	-15.3%
EPS	₹29.81	₹37.48	₹34.74	₹18.09	-15.3%
ROE	25.6%	24.5%	18.7%	9.0%	—
ROCE	32.8%	30.0%	26.1%	12.6%	—
Total Debt	₹10 Cr	₹40 Cr	₹39 Cr	₹19 Cr	+26.0%
Free Cash Flow	₹36 Cr	₹100 Cr	₹14 Cr	-₹4 Cr	—

🟢 Revenue has grown at 3.6% a year over 3 years.

🔴 EBITDA has shrunk at 5.3% a year over 3 years.

🔴 EBITDA Margin has fallen from 12.5% to 9.5% over 3 years (-3.0 pts).

🔴 PAT (Net Profit) has shrunk at 15.3% a year over 3 years.

🔴 EPS has shrunk at 15.3% a year over 3 years.

🔴 ROE has fallen from 25.6% to 9.0% over 3 years (-16.6 pts).

🔴 ROCE has fallen from 32.8% to 12.6% over 3 years (-20.2 pts).

🔴 Total Debt has grown at 26.0% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹36 Cr to -₹4 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹604 Cr

Total Liabilities

₹125 Cr

Total Debt

₹19 Cr

Cash & Equivalents

₹19 Cr

Operating Cash Flow

₹20 Cr

Capex

-₹24 Cr

Shareholding (proxy)

Institutional Holding

0.1%

Insider Holding

48.4%

Corporate Actions

Dividend Rate

₹3.4

Ex-Dividend Date

16 Sept 2026

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

3 positive3 general

Prakash Pipes (PPL) Share/Stock Price Live, NSE

TechGraph, 09 Oct

There Is A Reason Prakash Pipes Limited's (NSE:PPL) Price Is Undemanding

Simply Wall Street, 01 Feb

Prakash Pipes promoters confirm no encumbrance in FY26

scanx.trade, 23 Jun

Mukul Agrawal-Backed Plastic Products Company Reports Q1 FY27 Results; Profit Jumps 59% YoY, FII & DII Stake Doubles

Dalal Street Investment Journal, 14 AugResults

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

Prakash Pipes Q4 Revenue Jumps 22% to ₹220 Cr; Net Profit Hits ₹13.5 Cr

Sahi, 30 MayResults

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

Prakash Pipes standalone net profit rises 59.26% in the June 2026 quarter

Business Standard, 14 AugResults

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

Watch Items

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

DalalBaazaar Thesis

🔴Business QualityWeak7.5/20

🟡Financial HealthAdequate9.9/20

🔴GrowthWeak5.7/20

🔴ProfitabilityWeak5.8/15

🟢ValuationAttractive11.8/15

🔴RiskHigh4/10

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 3 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 8%9.5%
✗Free cash flow remains positive-₹4 Cr
✗Revenue growth stays above 4% a year3.6% CAGR
✓Debt / EBITDA stays below 2x0.3x
✓ROCE stays above 10%12.6%