Ramdevbaba Solvent Limited

Sector n/a · NSE

₹93.00+₹1.75 (+1.92%)

DalalBaazaar Score

36 / 100

🔴 Weak

Verdict

CAUTION

Risk

Very High

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

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:00 pm

Understanding the Business

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

How does it make money?

Turns over ₹823 Cr a year. Of every ₹100 of sales, about ₹1 reaches shareholders as profit, with ₹4 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?Little sign of one

Returns on capital of 6.6% 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.

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +18% while net margin moved -34% 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+18%

Margin effect-34%

DalalBaazaar Score

36/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ ROCE of 6.6% is below 10% — capital is not working hard
✗ ROCE has fallen by 19.7 points — returns are eroding
✗ EBITDA margin of 3.8% is thin — little cushion if costs rise
✗ Net margin of 1.4% is slim
• Revenue has compounded at 5.7% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

33/ 100

Weak

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

Valuation

35/ 100

Expensive

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

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

18.3x

PEG

—

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 30.7% to 7.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 26.3% to 6.6% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 4 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 261% over 3 years, from ₹99 Cr to ₹359 Cr.
🔴High leverageFinancial
Debt/Equity of 2.20x — earnings must service borrowings before shareholders see anything.
🔴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.
🔴Inventory building faster than salesFinancial
Inventory up 191% against revenue up 18% — stock may not be moving.
🟡Profit is decliningFinancial
Net profit is down 22% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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?

The debt load needs earnings to hold up
Debt is 11.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Growth barely outpaces inflation
Revenue compounding at 5.7% 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 30.7% to 7.0%. 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.
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

1EBITDA margin holds above 2%✓ 3.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 11.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹86 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ 2.8x
How much operating profit can fall before interest stops being comfortably covered.
5Revenue growth stays above 4% a year✓ 5.7% CAGR
Latest reported year was -11.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.

Investment Checklist

1 / 9 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
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

0 good · 5 neutral · 6 weak

Market Cap

₹213 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

7.0%

Weak

Weak capital efficiency

ROCE

6.6%

Weak

Low return on total capital employed

Debt/Equity

2.20x

High

High leverage

Revenue Growth (YoY)

-11.4%

Shrinking

Sales are contracting

Profit Growth (YoY)

-23.8%

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

-₹86 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Gross Margin

11.2%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

1.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.31

Comfortable

Healthy short-term liquidity

Technical Snapshot

SMA 20 / SMA 50

81.6 / 86.4

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

38.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹698 Cr	₹686 Cr	₹929 Cr	₹823 Cr	+5.7%
EBITDA	₹27 Cr	₹31 Cr	₹33 Cr	₹31 Cr	+5.4%
EBITDA Margin	3.8%	4.6%	3.5%	3.8%	—
PAT (Net Profit)	₹15 Cr	₹13 Cr	₹15 Cr	₹11 Cr	-8.0%
EPS	₹6.64	₹5.89	₹6.86	—	—
ROE	30.7%	17.9%	9.9%	7.0%	—
ROCE	26.3%	12.9%	7.6%	6.6%	—
Total Debt	₹99 Cr	₹192 Cr	₹267 Cr	₹359 Cr	+53.5%
Free Cash Flow	-₹29 Cr	-₹105 Cr	-₹129 Cr	-₹86 Cr	—

🟢 Revenue has grown at 5.7% a year over 3 years.

🟢 EBITDA has grown at 5.4% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 3.8% over 3 years.

🔴 PAT (Net Profit) has shrunk at 8.0% a year over 3 years.

🔴 ROE has fallen from 30.7% to 7.0% over 3 years (-23.7 pts).

🔴 ROCE has fallen from 26.3% to 6.6% over 3 years (-19.7 pts).

🔴 Total Debt has grown at 53.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹598 Cr

Total Liabilities

₹423 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

-₹56 Cr

Capex

-₹30 Cr

Recent News

6 general

Ramdevbaba Solvent (NSEI:RBS) - Stock Analysis

Simply Wall Street, 11 Oct

RAMDEVBABA SOLVENT LTD Share Price - Live NSE: RBS Stock Price & Chart

Upstox, 06 May

Why Ramdevbaba Solvent Ltd. Share Price is Rising Today

Univest, 31 Jul

Ramdevbaba Solvent acquires 14% stake in RBS Renewables for ₹3.64 crore

scanx.trade, 24 Jun

Ramdevbaba Solvent IPO announces price band at ₹80-85 apiece; issue to open on April 15

Livemint, 09 Apr

Ramdevbaba Solvent Limited IPO Date, Price, GMP, Review, Detail

IndiaIPO, 23 Apr

Watch Items

Revenue growth is negative (-11.4%) 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.
Sector/industry classification unavailable — verify manually for peer comparison.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

MiddlingValuation

WeakBusiness Quality · Financial Health · Growth · Profitability · Risk

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 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 ↑