Ratnaveer Precision Engineering Limited

Basic Materials — Steel · NSE

₹344.95+₹16.55 (+5.04%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

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

In simple words: Reasonable but unspectacular business quality, 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, 7:49 pm

Understanding the Business

Company site ↗

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

What does this company do?

Ratnaveer Precision Engineering Limited engages in the manufacture, export, and supply of stainless-steel products in India, Germany, Italy, Spain, France, the Netherlands, Poland, Sweden, the United Kingdom, the United States, and the United Arab Emirates.

IndustrySteel

SectorBasic Materials

Annual revenue₹1,068 Cr

How does it make money?

Turns over ₹1,068 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation.

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.

Compared side by side in Peers ↓

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.

Peer median ROE10.8%

What is the outlook?

1 analysts covering the stock expect revenue to grow about 10.7% and earnings to grow about 12.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+10.7%

Est. earnings growth+12.8%

Analysts1

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +123% while net margin moved +15% 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+123%

Margin effect+15%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

• ROCE of 12.6% is adequate but not distinctive
✗ ROCE has fallen by 16.2 points — returns are eroding
✗ EBITDA margin of 10.8% is thin — little cushion if costs rise
✗ Net margin of 6.0% is slim
• Revenue has compounded at 30.6% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

55/ 100

Average

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

Valuation

64/ 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

17.8x

3Y Median

22.4x

39 monthly readings · mean 22.5x · range 14.2x–37.5x

Sector Median

18.2x

median of 4 sector peers

🟢Current valuation is approximately 20% below its 3y median of 22.4x. 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 18.2x.

vs. its own history

Cheap

22.4x median over 39 months · -20%

vs. sector peers

Fair

18.2x median of 4 peers · -2%

vs. generic bands

Fair

15x–35x

EV/EBITDA

27.1x

PEG

0.48

What's Good / What's Bad

🟢 What's Going Well1

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

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 23.6% to 9.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 28.9% to 12.6% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 3 high · 2 watch

🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴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.
🔴Receivables growing faster than salesFinancial
Receivables up 176% against revenue up 123% — sales are being booked faster than they are collected.
🟡Debt is increasingFinancial
Total debt is up 46% over 3 years.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 40% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 20% 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.
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 176% against revenue up 123%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 23.6% to 9.6%. 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.
Several serious flags at once
3 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

1Revenue growth stays above 23% a year✓ 30.6% CAGR
Latest reported year was 18.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 9%✓ 10.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.9x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹163 Cr
Profit that never becomes cash eventually stops being profit.
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

6 / 12 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
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

3 good · 6 neutral · 2 weak

Market Cap

₹2,895 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

17.8x

Fair

Fairly valued against the generic band

P/B Ratio

3.50x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹19.4

Profitable

Profitable on a per-share basis

ROE

9.6%

Moderate

Moderate capital efficiency

ROCE

12.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.50x

Low

Conservative leverage

Revenue Growth (YoY)

18.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-9.7%

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

-₹163 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

21.7x

Flat

At or above the trailing multiple — no earnings uplift is being priced in

Operating Margin

7.9%

Average

Average margins

Net Margin

6.0%

Average

Average bottom-line conversion

Current Ratio

1.76

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.54

Defensive

Steadier than the market

52W Range Position

94%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

332.6 / 293.5

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

54.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹480 Cr	₹595 Cr	₹892 Cr	₹1,068 Cr	+30.6%
EBITDA	₹46 Cr	₹55 Cr	₹88 Cr	₹116 Cr	+36.1%
EBITDA Margin	9.6%	9.2%	9.9%	10.8%	—
PAT (Net Profit)	₹25 Cr	₹31 Cr	₹47 Cr	₹64 Cr	+36.9%
EPS	₹5.14	₹7.58	₹9.27	₹11.06	+29.1%
ROE	23.6%	12.3%	12.6%	9.6%	—
ROCE	28.9%	16.7%	16.9%	12.6%	—
Total Debt	₹229 Cr	₹206 Cr	₹194 Cr	₹335 Cr	+13.5%
Free Cash Flow	-₹18 Cr	-₹54 Cr	-₹43 Cr	-₹163 Cr	—

🟢 Revenue has grown at 30.6% a year over 3 years.

🟢 EBITDA has grown at 36.1% a year over 3 years.

🟢 EBITDA Margin has risen from 9.6% to 10.8% over 3 years (+1.3 pts).

🟢 PAT (Net Profit) has grown at 36.9% a year over 3 years.

🟢 EPS has grown at 29.1% a year over 3 years.

🔴 ROE has fallen from 23.6% to 9.6% over 3 years (-14.0 pts).

🔴 ROCE has fallen from 28.9% to 12.6% over 3 years (-16.2 pts).

🔴 Total Debt has grown at 13.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,262 Cr

Total Liabilities

₹592 Cr

Cash & Equivalents

₹92 Cr

Operating Cash Flow

-₹48 Cr

Capex

-₹114 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

51.2%

Analyst Consensus

Recommendations

1 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹255

-26.1% vs CMP

Target Range

₹255 – ₹255

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

3 mixed3 general

Ratnaveer Precision Engineering Share Price rises 9.01%

Univest, 21 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.

Why Ratnaveer Precision Engineering's (NSE:RATNAVEER) Earnings Are Weaker Than They Seem

Simply Wall Street, 20 MayResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Ratnaveer Precision Board Approves 1.25 Crore Shares Rights Issue At ₹264 Totaling ₹330 Crore

Sahi, 20 Aug

Press Release Distribution India

Business Wire India, 02 Sept

Ratnaveer Precision Engineering shares jump 14% on strong Q1 results

Moneycontrol.com, 27 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.

Ratnaveer Precision completes dispatch of ₹330 crore rights issue offer

scanx.trade, 17 Aug

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Growth · Valuation

MiddlingRisk

WeakBusiness Quality · Profitability

Points for each in the Score ↑

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

2 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive · see Key things to watch ↑