Raunaq lnternational Limited

Industrials — Engineering & Construction · BSE

₹38.51+₹1.83 (+4.99%)

DalalBaazaar Score

46 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, 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, 7:03 pm

Understanding the Business

Company site ↗

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

What does this company do?

Raunaq lnternational Limited engages in engineering contracting business in India. The company provides engineering; procurement, inspection, and supply; quality assurance; construction and installation; testing and commissioning; and project management and supervision services.

IndustryEngineering & Construction

SectorIndustrials

Employees31

Annual revenue₹36 Cr

How does it make money?

Turns over ₹36 Cr a year. Of every ₹100 of sales, about ₹0 reaches shareholders as profit, with ₹0 left at the operating level before interest, tax and depreciation. Each of its 31 employees supports ₹1.16 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.16 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., ADANI PORT & SEZ LTD, SIEMENS LTD. 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 7.2% 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 ROE14.1%

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 +525% while net margin moved -101% 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+525%

Margin effect-101%

DalalBaazaar Score

46/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 142.6x is demanding — it needs sustained high growth to justify
✗ P/E is 926% above its own historical median of 13.9x — expensive by its own standards

Quality vs. Valuation

Company Quality

49/ 100

Average

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

Valuation

26/ 100

Expensive

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

142.6x

1.3Y Median

13.9x

16 monthly readings · mean 13.5x · range 7.0x–20.8x

Sector Median

30.1x

median of 3 sector peers

⚠️Current valuation is approximately 926% above its 1.3y median of 13.9x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 374% above the peer median of 30.1x.

vs. its own history

Expensive

13.9x median over 16 months · +926%

vs. sector peers

Expensive

30.1x median of 3 peers · +374%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

195.8x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from -37.4% to 0.2% over 3 years.
Return on equity is rising
ROE has improved from -31.5% to 1.2%.
Return on capital is rising
ROCE has improved from -33.1% to 7.2%.

🔴 What Needs Attention0

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

Red Flags

5 items require attention · 4 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 1820% over 3 years, from ₹0 Cr to ₹5 Cr.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.6x — little room if earnings dip.
🔴Free cash flow negative for 3 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Inventory building faster than salesFinancial
Inventory up 718% against revenue up 525% — stock may not be moving.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 19.7x to 1.6x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -37.4% to 0.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 53.6x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 926% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
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.
Several serious flags at once
4 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 63% a year✓ 84.2% CAGR
Latest reported year was -25.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above -2%✓ 0.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 53.6x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹5 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 1.6x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

3 / 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

1 good · 4 neutral · 6 weak

Market Cap

₹13 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

142.6x

Expensive

Expensive — verify against sector peers

P/B Ratio

1.64x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.27

Profitable

Profitable on a per-share basis

ROE

1.2%

Weak

Weak capital efficiency

ROCE

7.2%

Weak

Low return on total capital employed

Debt/Equity

0.61x

Moderate

Moderate leverage

Revenue Growth (YoY)

-25.2%

Shrinking

Sales are contracting

Profit Growth (YoY)

-92.5%

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

-₹3 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

-0.7%

Weak

Assets generate little profit

Operating Margin

-6.0%

Weak

Thin margins leave little room for error

Net Margin

0.3%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.09

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

-0.12

Defensive

Steadier than the market

52W Range Position

29%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

36.7 / 38.4

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

47.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹6 Cr	₹4 Cr	₹21 Cr	₹36 Cr	+84.2%
EBITDA	-₹2 Cr	-₹1 Cr	₹2 Cr	₹0 Cr	—
EBITDA Margin	-37.4%	-23.8%	9.7%	0.2%	—
PAT (Net Profit)	-₹2 Cr	-₹1 Cr	₹1 Cr	₹0 Cr	—
EPS	₹-7.12	₹-3.2	₹3.65	—	—
ROE	-31.5%	-16.4%	15.8%	1.2%	—
ROCE	-33.1%	-18.7%	13.5%	7.2%	—
Total Debt	₹0 Cr	—	₹2 Cr	₹5 Cr	+167.8%
Free Cash Flow	₹1 Cr	-₹1 Cr	-₹1 Cr	-₹5 Cr	—

🟢 Revenue has grown at 84.2% a year over 3 years.

🟢 EBITDA has turned positive, from -₹2 Cr to ₹0 Cr.

🟢 EBITDA Margin has risen from -37.4% to 0.2% over 3 years (+37.6 pts).

🟢 PAT (Net Profit) has turned positive, from -₹2 Cr to ₹0 Cr.

🟢 ROE has risen from -31.5% to 1.2% over 3 years (+32.6 pts).

🟢 ROCE has risen from -33.1% to 7.2% over 3 years (+40.4 pts).

🔴 Total Debt has grown at 167.8% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹1 Cr to -₹5 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹25 Cr

Total Liabilities

₹17 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹4 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.0%

Corporate Actions

Ex-Dividend Date

26 Jul 2016

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
ADANI PORT & SEZ LTD	29.9x	14.1%
SIEMENS LTD	88.8x	10.5%

Recent News

2 negative4 general

Raunaq International gains after bagging Rs 18 crore orders from Ambuja Cements

Business Standard, 07 Jul

Raunaq International Secures Rs 181 mn Orders From Ambuja Cements

Construction World, 13 Jul

Jonjua Overseas (BSE:542446) - Stock Analysis

Simply Wall Street, 16 Oct

Raunaq International Limited Announces Demise of Secretarial Auditor Mr. Sanket Jain

scanx.trade, 24 Feb

Cochin Shipyard drops after government initiates stake sale via OFS

Business Standard, 07 JulOwnership

🔴Potentially negativePromoter selling or pledging is a signal worth understanding, though the reason is often personal rather than about the business.

Apollo Sindoori Hotels standalone net profit declines 25.52% in the March 2026 quarter

Business Standard, 28 MayResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Watch Items

Revenue growth is negative (-25.2%) 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

StrongGrowth

MiddlingProfitability

WeakBusiness Quality · Financial Health · Valuation · Risk

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

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑