Saffron Industries Limited

Basic Materials — Paper & Paper Products · BSE

₹23.22−₹0.72 (−3.01%)

DalalBaazaar Score

19 / 100

🔴 Poor

Verdict

HIGH RISK

Risk

Very High

Driven by negative shareholders' equity — the company owes more than it owns, short-term liabilities exceed short-term assets, the company is currently loss-making.

In simple words: The company owes more than it owns — years of losses have wiped out its net worth, but sales are shrinking. Solvency — whether it can keep funding itself at all — is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:58 pm

Understanding the Business

Company site ↗

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

What does this company do?

Saffron Industries Limited engages in real estate development business in India. It is involved in purchasing and developing land; construction of residential and commercial projects; and sale of flats and other developed properties.

IndustryPaper & Paper Products

SectorBasic Materials

Employees9

Annual revenue₹7 Cr

How does it make money?

Turns over ₹7 Cr a year. Of every ₹100 of sales, about ₹-23 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 9 employees supports ₹76.3 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹76.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, ULTRATECH CEMENT LIMITED, ASIAN PAINTS LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -60% while net margin moved +160% 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-60%

Margin effect+160%

DalalBaazaar Score

19/ 100

Poor

Weighted across six categories. Every point is explained below.

✗ Shareholders' equity is negative — accumulated losses exceed the capital in the business

Quality vs. Valuation

Company Quality

18/ 100

Weak

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

Valuation

30/ 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

N/A

Multiples unreliable — equity base is negative

EV/EBITDA

23.8x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 2.5% to 11.1% over 3 years.
Debt is being paid down
Total debt is down 90% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.

🔴 What Needs Attention0

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

Red Flags

4 items require attention · 3 high · 1 watch

🔴Negative shareholders' equityFinancial
Liabilities exceed assets — accumulated losses have wiped out the company's net worth.
🔴The company is lossmakingFinancial
Net profit of -₹2 Cr in the latest reported year.
🔴Inventory building faster than salesFinancial
Inventory up 160% against revenue up -60% — stock may not be moving.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.63 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 2.5% to 11.1%. 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 90% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Solvency comes before everything else
Liabilities exceed assets. Until net worth is rebuilt, the equity is a claim on a business that owes more than it owns, and further losses or a funding squeeze can leave shareholders with nothing.
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
3 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 9%✓ 11.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Free cash flow remains positive✓ ₹10 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

4 / 9 checks passed

✗ Shareholders' equity is positive (assets exceed liabilities)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ 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

₹17 Cr

Micro 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

Not available

No data

Source didn't return this field

EPS (TTM)

₹-1.89

Loss-making

Negative earnings per share — the business is losing money

ROE

Not meaningful

Negative equity

Return on equity can't be read when equity itself is negative

ROCE

Not available

No data

Source didn't return this field

Debt/Equity

Not meaningful

Negative equity

Shareholders' equity is negative, so this ratio can't be read

Revenue Growth (YoY)

-65.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

-156.0%

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

₹9 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

ROA

8.2%

Good

Assets are working hard

Operating Margin

10.6%

Average

Average margins

Net Margin

37.0%

Good

Strong bottom-line conversion

Current Ratio

0.63

Tight

Tight short-term liquidity

Beta (vs Nifty)

1.00

Market-like

Moves roughly in line with the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

24.2 / 25.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

42.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹17 Cr	₹16 Cr	₹6 Cr	₹7 Cr	-26.1%
EBITDA	₹0 Cr	₹193 Cr	₹5 Cr	₹1 Cr	+21.5%
EBITDA Margin	2.5%	1189.0%	76.1%	11.1%	—
PAT (Net Profit)	-₹2 Cr	-₹2 Cr	₹3 Cr	-₹2 Cr	—
EPS	₹-2.09	₹-2.63	₹3.91	₹2.19	—
ROCE	-16.1%	-42.9%	135.4%	—	—
Total Debt	₹20 Cr	₹17 Cr	₹12 Cr	₹2 Cr	-53.9%
Free Cash Flow	-₹2 Cr	₹327 Cr	₹5 Cr	₹10 Cr	—

🔴 Revenue has shrunk at 26.1% a year over 3 years.

🟢 EBITDA has grown at 21.5% a year over 3 years.

🟢 EBITDA Margin has risen from 2.5% to 11.1% over 3 years (+8.6 pts).

🟢 EPS has turned positive, from ₹-2.09 to ₹2.19.

🟢 Total Debt has shrunk at 53.9% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹2 Cr to ₹10 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹12 Cr

Total Liabilities

₹20 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹10 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

68.1%

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
ULTRATECH CEMENT LIMITED	37.6x	11.1%
ASIAN PAINTS LIMITED	46.9x	22.3%

Recent News

1 positive5 general

Saffron Industries AGM set for September 24; Manoj Sinha seeks re-appointment

scanx.trade, 01 Sept

Saffron Industries approves FY26 financials, sets Sept 24 AGM date

scanx.trade, 20 Aug

In a first, Ladakh grows saffron on a large scale: Why are Iranian corms being tested on barren land? Know importance

Livemint, 04 Oct

Saffron Speciality Papers Limited IPO – GMP, Dates, Price & Key Details

IndiaIPO, 21 Jan

October Multibaggers: 5 stocks doubled investors wealth in a month

Business Today, 04 Nov

Zensar Technologies consolidated net profit rises 0.99% in the June 2026 quarter

Business Standard, 30 JulResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Watch Items

Revenue growth is negative (-65.8%) on the latest reported period — check if this is one-off or a trend.
Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
2 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

WeakBusiness Quality · Financial Health · Growth · Profitability · Valuation · Risk

Points for each in the Score ↑

Avoid until solvency is resolved

Saffron Industries Limited owes more than it owns. Whatever the operating numbers show, the equity is a residual claim on a business with negative net worth, and that question has to be settled before any of the rest is worth weighing. 3 high-severity red flags sit above this conclusion and should be read first.

1 of 3 tripwires tripped — Debt / EBITDA stays below 2x · see Key things to watch ↑