RRIL Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹15.99+₹0.46 (+2.96%)

DalalBaazaar Score

42 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by 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, 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, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

RRIL Limited, together with its subsidiary, manufactures and trades in textile products in India. It operates through Textiles and Real Estate Development segments.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees7

Annual revenue₹122 Cr

How does it make money?

Turns over ₹122 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 7 employees supports ₹17.43 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹17.43 Cr

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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 9.9% 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 ROE25.9%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -21% while net margin moved -20% 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-21%

Margin effect-20%

DalalBaazaar Score

42/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 7.6% a year
✗ Profit has declined at 14.3% a year

Quality vs. Valuation

Company Quality

38/ 100

Weak

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

Valuation

69/ 100

Cheap

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

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

19.7x

Sector Median

69.2x

median of 4 sector peers

🟢Against its sector it trades 71% below the peer median of 69.2x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

69.2x median of 4 peers · -71%

vs. generic bands

Fair

15x–35x

EV/EBITDA

15.4x

PEG

0.79

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 14.9% to 7.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 19.7% to 9.9% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 2 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 72% over 3 years, from ₹20 Cr to ₹34 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 66% against revenue up -21% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹2 Cr in the latest year.
🟡Profit is decliningFinancial
Net profit is down 37% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 71% 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?

Returns on shareholder capital are falling
ROE has dropped from 14.9% to 7.6%. 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
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

1EBITDA margin holds above 10%✓ 12.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Free cash flow remains positive✗ -₹2 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✓ 9.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Interest cover stays above 4x✓ 7.1x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

6 / 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

4 good · 5 neutral · 2 weak

Market Cap

₹194 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.7x

Fair

Fairly valued against the generic band

P/B Ratio

1.72x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.81

Profitable

Profitable on a per-share basis

ROE

7.6%

Weak

Weak capital efficiency

ROCE

9.9%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.30x

Low

Conservative leverage

Revenue Growth (YoY)

23.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

25.0%

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

-₹2 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

5.6%

Average

Average margins

Net Margin

7.0%

Average

Average bottom-line conversion

Current Ratio

2.64

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

1.09

Market-like

Moves roughly in line with the market

52W Range Position

27%

Mid-range

Technical Snapshot

RSI (14)

48.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹155 Cr	₹95 Cr	₹113 Cr	₹122 Cr	-7.6%
EBITDA	₹21 Cr	₹10 Cr	₹12 Cr	₹15 Cr	-11.0%
EBITDA Margin	13.6%	10.4%	10.4%	12.2%	—
PAT (Net Profit)	₹14 Cr	₹6 Cr	₹7 Cr	₹9 Cr	-14.3%
EPS	₹1.13	₹0.48	₹0.56	₹0.72	-13.9%
ROE	14.9%	5.8%	6.5%	7.6%	—
ROCE	19.7%	8.2%	8.8%	9.9%	—
Total Debt	₹20 Cr	₹15 Cr	₹15 Cr	₹34 Cr	+19.7%
Free Cash Flow	₹9 Cr	₹1 Cr	-₹16 Cr	-₹2 Cr	—

🔴 Revenue has shrunk at 7.6% a year over 3 years.

🔴 EBITDA has shrunk at 11.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 13.6% to 12.2% over 3 years (-1.5 pts).

🔴 PAT (Net Profit) has shrunk at 14.3% a year over 3 years.

🔴 EPS has shrunk at 13.9% a year over 3 years.

🔴 ROE has fallen from 14.9% to 7.6% over 3 years (-7.3 pts).

🔴 ROCE has fallen from 19.7% to 9.9% over 3 years (-9.8 pts).

🔴 Total Debt has grown at 19.7% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹9 Cr to -₹2 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹154 Cr

Total Liabilities

₹40 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹4 Cr

Capex

-₹6 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

74.3%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

3 mixed3 general

RRIL Share Price Rises 8.83%: Price Action View

Univest, 06 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.

RRIL Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 29 Aug

RRIL Q2 2026 Earnings: Revenue Climbs 8.1% YoY as EPS Prints at ₹0.72 - Earnings Analysis

https://www.siam.in/, 12 SeptResults

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

RRIL to acquire 25% stake in Sumati Spintex for ₹3.11 Cr

scanx.trade, 11 JulM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

BTTL Stock Price and Chart — NSE:BTTL

TradingView, 20 Apr

RRIL shareholders approve FY26 financials, re-appoint Jain at 35th AGM

scanx.trade, 25 Sept

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health

MiddlingValuation

WeakBusiness Quality · Growth · Profitability · Risk

Points for each in the Score ↑

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 2 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 ↑