Rachit Prints Limited

Consumer Cyclical — Textile Manufacturing · BSE

₹168.50−₹11.50 (−6.39%)

DalalBaazaar Score

72 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

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

In simple words: Strong business and financial position, though profits are falling even as sales grow. 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 Rachit Prints Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Rachit Prints Limited manufactures and sells specialty fabrics in India. The company offers knitted, printed, warp knit, pillow fabrics; and binding tapes. It also trades comforters and bed sheets. It serves mattress and home furnishing industries.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees65

Annual revenue₹53 Cr

How does it make money?

Turns over ₹53 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹16 left at the operating level before interest, tax and depreciation. Each of its 65 employees supports ₹81.9 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹81.9 lakh

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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?Some evidence

ROCE of 1608.8% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +67% while net margin moved +748% 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+67%

Margin effect+748%

DalalBaazaar Score

72/ 100

Good

Weighted across six categories. Every point is explained below.

✗ 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

80/ 100

Excellent

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

Valuation

70/ 100

Cheap

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

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

15.7x

1.3Y Median

18.2x

15 monthly readings · mean 16.8x · range 10.6x–22.2x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 14% below its 1.3y median of 18.2x. 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 77% below the peer median of 69.2x.

vs. its own history

Fair

18.2x median over 15 months · -14%

vs. sector peers

Cheap

69.2x median of 4 peers · -77%

vs. generic bands

Fair

15x–35x

EV/EBITDA

9.5x

PEG

0.11

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from 6.5% to 16.5% over 3 years.
Debt is being paid down
Total debt is down 99% over 3 years.
Return on equity is rising
ROE has improved from 9.4% to 1313.0%.
Return on capital is rising
ROCE has improved from 12.9% to 1608.8%.
High return on capital employed
ROCE of 1608.8% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

2 items require attention · 1 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.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹13 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 1608.8% 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 6.5% to 16.5%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 99% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 77% 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?

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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 14% a year✓ 18.7% CAGR
Latest reported year was 28.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 14%✓ 16.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹13 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 1606%✓ 1608.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

5 good · 4 neutral · 2 weak

Market Cap

₹83 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

15.7x

Fair

Fairly valued against the generic band

P/B Ratio

2.38x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹10.7

Profitable

Profitable on a per-share basis

ROE

19.4%

Strong

Strong capital efficiency

ROCE

1608.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.31x

Low

Conservative leverage

Revenue Growth (YoY)

28.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-31.3%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹14 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

10.8%

Good

Assets are working hard

Operating Margin

10.7%

Average

Average margins

Net Margin

8.6%

Average

Average bottom-line conversion

Current Ratio

3.45

Comfortable

Healthy short-term liquidity

52W Range Position

57%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

184.5 / 187.3

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

27.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹32 Cr	₹36 Cr	₹42 Cr	₹53 Cr	+18.7%
EBITDA	₹2 Cr	₹4 Cr	₹7 Cr	₹9 Cr	+61.7%
EBITDA Margin	6.5%	11.8%	17.5%	16.5%	—
PAT (Net Profit)	₹0 Cr	₹2 Cr	₹5 Cr	₹5 Cr	+142.1%
EPS	₹0.65	₹4.11	₹9.24	—	—
ROE	9.4%	37.2%	3706.0%	1313.0%	—
ROCE	12.9%	37.4%	3923.5%	1608.8%	—
Total Debt	₹15 Cr	₹6 Cr	₹0 Cr	₹0 Cr	-80.5%
Free Cash Flow	-₹3 Cr	₹8 Cr	-₹5 Cr	-₹13 Cr	—

🟢 Revenue has grown at 18.7% a year over 3 years.

🟢 EBITDA has grown at 61.7% a year over 3 years.

🟢 EBITDA Margin has risen from 6.5% to 16.5% over 3 years (+10.0 pts).

🟢 PAT (Net Profit) has grown at 142.1% a year over 3 years.

🟢 ROE has risen from 9.4% to 1313.0% over 3 years (+1303.6 pts).

🟢 ROCE has risen from 12.9% to 1608.8% over 3 years (+1595.9 pts).

🟢 Total Debt has shrunk at 80.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1 Cr

Total Liabilities

₹0 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹4 Cr

Capex

-₹9 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

69.8%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

6 general

Rachit Prints Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 31 Aug

Rachit Prints Limited Share Price

Upstox, 05 May

Rachit Prints accepts resignation of Company Secretary Anshika Garg

scanx.trade, 22 Jun

Compare with

Equitymaster, 08 Oct

Rachit Prints approves all resolutions at 23rd annual general meeting

scanx.trade, 04 Oct

Rachit Prints shares make weak stock market debut, list at 20% discount on BSE SME

Moneycontrol.com, 08 Sept

Watch Items

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

StrongBusiness Quality · Financial Health · Growth · Profitability

MiddlingValuation

WeakRisk

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑