Sangam (India) Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹603.65+₹2.05 (+0.34%)

DalalBaazaar Score

42 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by moderate debt load, 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 modest growth. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:03 pm

Understanding the Business

Company site ↗

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

What does this company do?

Sangam (India) Limited operates as an integrated textile company in India.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees10,301

Annual revenue₹3,161 Cr

How does it make money?

Turns over ₹3,161 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹10 left at the operating level before interest, tax and depreciation. Each of its 10,301 employees supports ₹30.7 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹30.7 lakh

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 11.6% 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.

Peer median ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +19% while net margin moved -47% 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+19%

Margin effect-47%

DalalBaazaar Score

42/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 6.0% — barely ahead of inflation
✗ Profit has declined at 14.1% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows

Quality vs. Valuation

Company Quality

36/ 100

Weak

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

Valuation

75/ 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

25.0x

3Y Median

47.9x

40 monthly readings · mean 45.7x · range 11.3x–96.4x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 48% below its 3y median of 47.9x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 64% below the peer median of 69.2x.

vs. its own history

Cheap

47.9x median over 40 months · -48%

vs. sector peers

Cheap

69.2x median of 4 peers · -64%

vs. generic bands

Fair

15x–35x

EV/EBITDA

13.4x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Margins are compressing
EBITDA margin has slipped from 11.5% to 10.0% over 3 years.
Return on equity is falling
ROE has dropped from 14.8% to 7.7% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 16.4% to 11.6% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 55% over 3 years, from ₹826 Cr to ₹1,278 Cr.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Receivables growing faster than salesFinancial
Receivables up 81% against revenue up 19% — sales are being booked faster than they are collected.
🟡Profit is decliningFinancial
Net profit is down 37% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 48% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 64% 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?

Margins are being competed away
EBITDA margin has fallen from 11.5% to 10.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.1x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Sales are being booked faster than collected
Receivables are up 81% against revenue up 19%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Growth barely outpaces inflation
Revenue compounding at 6.0% 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 14.8% to 7.7%. 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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 8%✓ 10.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.1x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 2.1x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 4% a year✓ 6.0% CAGR
Latest reported year was 8.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹43 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

7 / 11 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
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

3 good · 7 neutral · 1 weak

Market Cap

₹2,977 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

25.0x

Fair

Fairly valued against the generic band

P/B Ratio

2.82x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹24.17

Profitable

Profitable on a per-share basis

ROE

7.7%

Weak

Weak capital efficiency

ROCE

11.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

1.19x

Moderate

Moderate leverage

Revenue Growth (YoY)

8.9%

Modest

Modest growth

Profit Growth (YoY)

1842.9%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.33%

Modest

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

Free Cash Flow

₹43 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

9.3%

Average

Average margins

Net Margin

3.7%

Average

Average bottom-line conversion

Current Ratio

1.11

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.58

Defensive

Steadier than the market

52W Range Position

74%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

608.0 / 592.8

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

46.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,656 Cr	₹2,550 Cr	₹2,774 Cr	₹3,161 Cr	+6.0%
EBITDA	₹306 Cr	₹221 Cr	₹247 Cr	₹315 Cr	+0.9%
EBITDA Margin	11.5%	8.7%	8.9%	10.0%	—
PAT (Net Profit)	₹131 Cr	₹41 Cr	₹32 Cr	₹83 Cr	-14.1%
EPS	₹27.26	₹8.21	₹6.33	₹16.44	-15.5%
ROE	14.8%	4.1%	3.2%	7.7%	—
ROCE	16.4%	7.1%	7.3%	11.6%	—
Total Debt	₹826 Cr	₹1,066 Cr	₹1,138 Cr	₹1,278 Cr	+15.6%
Free Cash Flow	-₹173 Cr	-₹248 Cr	₹117 Cr	₹43 Cr	—

🟢 Revenue has grown at 6.0% a year over 3 years.

🟡 EBITDA has been broadly flat over 3 years (0.9% a year).

🔴 EBITDA Margin has fallen from 11.5% to 10.0% over 3 years (-1.6 pts).

🔴 PAT (Net Profit) has shrunk at 14.1% a year over 3 years.

🔴 EPS has shrunk at 15.5% a year over 3 years.

🔴 ROE has fallen from 14.8% to 7.7% over 3 years (-7.1 pts).

🔴 ROCE has fallen from 16.4% to 11.6% over 3 years (-4.8 pts).

🔴 Total Debt has grown at 15.6% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹173 Cr to ₹43 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,315 Cr

Total Liabilities

₹2,239 Cr

Cash & Equivalents

₹51 Cr

Operating Cash Flow

₹269 Cr

Capex

-₹226 Cr

Shareholding (proxy)

Institutional Holding

12.8%

Insider Holding

80.1%

Corporate Actions

Dividend Rate

₹2

Ex-Dividend Date

22 Jun 2026

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

1 positive1 mixed4 general

Compare with SANGAM INDIA

Equitymaster, 07 Oct

Sangam (India) Share: Bull Case vs Bear Case for 2026

Univest, 18 Sept

Sangam (India) consolidated net profit rises 1825.82% in the June 2026 quarter

Business Standard, 18 JulResults

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

Sangam India shareholders approve ₹100 crore warrant issue

scanx.trade, 01 Aug

Sangam (India) - Madhusudan Kela’s portfolio: Top 5 holdings and how they performed in August

The Economic Times, 03 Sept

Sangam (India) Share Price Target 2026: Rs 650 Analyst Forecast

Univest, 26 JunAnalyst view

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

Watch Items

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

DalalBaazaar Thesis

StrongValuation

MiddlingFinancial Health

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

2 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x · see Key things to watch ↑