RENTOMOJO LIMITED

Industrials — Rental & Leasing Services · NSE

₹586.00+₹28.90 (+5.19%)

DalalBaazaar Score

63 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

Driven by short-term liabilities exceed short-term assets, negative free cash flow, small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:48 pm

Understanding the Business

Company site ↗

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

What does this company do?

Rentomojo Limited provides online rental service for furniture and appliances. The company provides rental services for various products, including delivery, installation, and pick-up. The company was founded in 2012 and is based in Bengaluru, India.

IndustryRental & Leasing Services

SectorIndustrials

Employees835

Annual revenue₹369 Cr

How does it make money?

Turns over ₹369 Cr a year. Of every ₹100 of sales, about ₹28 reaches shareholders as profit, with ₹45 left at the operating level before interest, tax and depreciation. Each of its 835 employees supports ₹44.2 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹44.2 lakh

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.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 21.1%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 35.3% against a peer median of 15.2% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

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 +207% while net margin moved +669% 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+207%

Margin effect+669%

DalalBaazaar Score

63/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 58.5x is demanding — it needs sustained high growth to justify
✗ P/B of 5.88x is a steep premium to book

Quality vs. Valuation

Company Quality

76/ 100

Good

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

Valuation

56/ 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

58.5x

Sector Median

88.8x

median of 3 sector peers

🟢Against its sector it trades 34% below the peer median of 88.8x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

88.8x median of 3 peers · -34%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

37.7x

PEG

0.31

What's Good / What's Bad

🟢 What's Going Well3

Return on equity is rising
ROE has improved from 19.8% to 35.3%.
High return on capital employed
ROCE of 21.1% 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

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 108% over 3 years, from ₹112 Cr to ₹233 Cr.
🔴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.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.55 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 21.1% 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.
Cheaper than its peers
It trades 34% 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
Small 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
2 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 34% a year✓ 45.4% CAGR
Latest reported year was 51.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 43%✓ 45.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹4 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✓ 3.7x
How much operating profit can fall before interest stops being comfortably covered.
5Debt / EBITDA stays below 2x✓ 1.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.

Investment Checklist

7 / 10 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

Price history

Quick Metrics

5 good · 3 neutral · 3 weak

Market Cap

₹6,101 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

58.5x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.88x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹10.02

Profitable

Profitable on a per-share basis

ROE

35.3%

Strong

Strong capital efficiency

ROCE

21.1%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.79x

Moderate

Moderate leverage

Revenue Growth (YoY)

51.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

142.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

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

Free Cash Flow

-₹4 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

22.6%

Good

Healthy core-business profitability

Net Margin

23.1%

Good

Strong bottom-line conversion

Current Ratio

0.55

Tight

Tight short-term liquidity

52W Range Position

63%

Mid-range

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹120 Cr	₹192 Cr	₹264 Cr	₹369 Cr	+45.4%
EBITDA	₹53 Cr	₹78 Cr	₹117 Cr	₹167 Cr	+46.8%
EBITDA Margin	44.2%	40.4%	44.2%	45.4%	—
PAT (Net Profit)	₹4 Cr	₹22 Cr	₹43 Cr	₹104 Cr	+187.0%
EPS	₹0.42	₹2.15	₹4.14	₹10.02	+187.0%
ROE	19.8%	16.1%	23.5%	35.3%	—
ROCE	22.2%	20.7%	23.8%	21.1%	—
Total Debt	₹112 Cr	₹167 Cr	₹192 Cr	₹233 Cr	+27.7%
Free Cash Flow	-₹20 Cr	-₹57 Cr	-₹25 Cr	-₹4 Cr	—

🟢 Revenue has grown at 45.4% a year over 3 years.

🟢 EBITDA has grown at 46.8% a year over 3 years.

🟢 EBITDA Margin has risen from 44.2% to 45.4% over 3 years (+1.2 pts).

🟢 PAT (Net Profit) has grown at 187.0% a year over 3 years.

🟢 EPS has grown at 187.0% a year over 3 years.

🟢 ROE has risen from 19.8% to 35.3% over 3 years (+15.4 pts).

🔴 ROCE has fallen from 22.2% to 21.1% over 3 years (-1.1 pts).

🔴 Total Debt has grown at 27.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹641 Cr

Total Liabilities

₹345 Cr

Cash & Equivalents

₹21 Cr

Operating Cash Flow

₹173 Cr

Capex

-₹177 Cr

Shareholding (proxy)

Institutional Holding

25.9%

Insider Holding

58.4%

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 mixed3 general

Rentomojo Share Price Up 38%: 5 Drivers and Risks

Univest, 16 OctPrice 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.

Rentomojo share price jumps 38% from IPO price in nearly 1 month | Check 5 factors driving the surge

TradingView, 15 OctPrice 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.

Rentomojo share price jumps 38% from IPO price in nearly 1 month | Check 5 factors driving the surge

Livemint, 15 OctPrice 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.

Rentomojo Limited (RENTOMOJO) Share Price NSE

TechGraph, 07 Oct

Why Rentomojo Share Price is Rising

Equitymaster, 06 Oct

Rentomojo shares list at Rs 482.45, a 19% premium to IPO price after 73x subscription

Moneycontrol.com, 17 Sept

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Growth · Profitability

WeakFinancial Health · Valuation · Risk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 2 high-severity red flags sit above this conclusion and should be read first.

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