RHI Magnesita India Limited

Industrials — Metal Fabrication · NSE

₹371.00+₹2.30 (+0.62%)

DalalBaazaar Score

48 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by the company is currently loss-making, small-cap size, which brings sharper price swings.

In simple words: The company is currently losing money, with modest growth. Thin profit margins are the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:59 pm

Understanding the Business

Company site ↗

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

What does this company do?

RHI Magnesita India Limited engages in the manufacture and trading of refractories, monolithics, bricks, and ceramic paper in India and internationally.

IndustryMetal Fabrication

SectorIndustrials

Employees1,641

Annual revenue₹3,975 Cr

How does it make money?

Turns over ₹3,975 Cr a year. Of every ₹100 of sales, about ₹-10 reaches shareholders as profit, with ₹-2 left at the operating level before interest, tax and depreciation. Each of its 1,641 employees supports ₹2.42 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹2.42 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, HINDALCO INDUSTRIES LTD, VEDANTA 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?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 ROE18.7%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 9.8% and earnings to grow about 25.4% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+9.8%

Est. earnings growth+25.4%

Analysts2

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +48% while net margin moved -44% 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+48%

Margin effect-44%

DalalBaazaar Score

48/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✓ ROE has improved by 5.4 points over the period

Quality vs. Valuation

Company Quality

50/ 100

Average

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

Valuation

29/ 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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

—

PEG

—

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from -10.4% to -2.4% over 3 years.
Debt is being paid down
Total debt is down 72% over 3 years.
Cash generation is improving
Free cash flow is up 41% over 3 years.
Return on equity is rising
ROE has improved from -16.1% to -10.8%.
Return on capital is rising
ROCE has improved from -10.6% to -7.2%.
Very low debt
Debt/Equity of 0.13x leaves the balance sheet with plenty of headroom.

🔴 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

🔴Thin interest coverageFinancial
Operating profit covers interest only -7.7x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹383 Cr in the latest reported year.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 7.2x to -7.7x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -10.4% to -2.4%. 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 72% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹273 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.

🔴 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 10% a year✓ 13.9% CAGR
Latest reported year was 5.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above -4%✓ -2.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Interest cover stays above 3x✗ -7.7x
How much operating profit can fall before interest stops being comfortably covered.
4Free cash flow remains positive✓ ₹273 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ -7.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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 · 4 neutral · 4 weak

Market Cap

₹7,661 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

2.15x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹-17.12

Loss-making

Negative earnings per share — the business is losing money

ROE

-10.8%

Weak

Weak capital efficiency

ROCE

-7.2%

Weak

Low return on total capital employed

Debt/Equity

0.13x

Low

Conservative leverage

Revenue Growth (YoY)

5.6%

Modest

Modest growth

Profit Growth (YoY)

121.6%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.67%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹273 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

20.9x

Operating Margin

8.7%

Average

Average margins

Net Margin

-8.7%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.75

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.35

Defensive

Steadier than the market

52W Range Position

27%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

376.4 / 378.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

30.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,690 Cr	₹3,781 Cr	₹3,624 Cr	₹3,975 Cr	+13.9%
EBITDA	-₹280 Cr	₹257 Cr	₹515 Cr	-₹94 Cr	—
EBITDA Margin	-10.4%	6.8%	14.2%	-2.4%	—
PAT (Net Profit)	-₹466 Cr	-₹100 Cr	₹203 Cr	-₹383 Cr	—
EPS	₹-27.85	₹-4.88	₹9.81	₹-18.54	—
ROE	-16.1%	-2.6%	5.1%	-10.8%	—
ROCE	-10.6%	1.1%	7.0%	-7.2%	—
Total Debt	₹1,589 Cr	₹487 Cr	₹380 Cr	₹448 Cr	-34.4%
Free Cash Flow	₹193 Cr	₹188 Cr	₹254 Cr	₹273 Cr	+12.2%

🟢 Revenue has grown at 13.9% a year over 3 years.

🟢 EBITDA Margin has risen from -10.4% to -2.4% over 3 years (+8.1 pts).

🟢 ROE has risen from -16.1% to -10.8% over 3 years (+5.4 pts).

🟢 ROCE has risen from -10.6% to -7.2% over 3 years (+3.4 pts).

🟢 Total Debt has shrunk at 34.4% a year over 3 years.

🟢 Free Cash Flow has grown at 12.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,861 Cr

Total Liabilities

₹1,300 Cr

Cash & Equivalents

₹158 Cr

Operating Cash Flow

₹409 Cr

Capex

-₹136 Cr

Shareholding (proxy)

Institutional Holding

25.5%

Insider Holding

57.6%

Corporate Actions

Dividend Rate

₹2.5

Ex-Dividend Date

11 Sept 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹522.5

+40.8% vs CMP

Target Range

₹488 – ₹557

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
HINDALCO INDUSTRIES LTD	12.3x	12.0%
VEDANTA LIMITED	10.4x	18.7%

Recent News

3 mixed1 negative2 general

RHI Magnesita India Ltd is Rated Sell

MarketsMojo, 18 Oct

Earnings Release: Here's Why Analysts Cut Their RHI Magnesita India Limited (NSE:RHIM) Price Target To ₹545

Simply Wall Street, 14 AugAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

RHIM Forecast — Price Target — Prediction for 2027

TradingView, 25 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

RHI Magnesita shares gain over 4% after Dalmia Bharat Refractories stake sale; key details

Upstox, 23 SeptOwnership

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

Earnings call transcript: RHI Magnesita India Q1 2026 stock falls on outlook

Investing.com, 12 AugResults

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

RHI Magnesita India to host investor meeting in Visakhapatnam on Sep 30

scanx.trade, 25 Sept

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health

MiddlingGrowth · Risk

WeakBusiness Quality · Profitability · Valuation

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

2 of 5 tripwires tripped — Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑