Saroja Pharma Industries India Limited

Sector n/a · NSE

₹41.00−₹0.65 (−1.56%)

DalalBaazaar Score

49 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by moderate debt load, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, 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, 7:49 pm

Understanding the Business

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

How does it make money?

Turns over ₹70 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹5 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?Little sign of one

Returns on capital of 14.1% 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.

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +40% while net margin moved +9% 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+40%

Margin effect+9%

DalalBaazaar Score

49/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

52/ 100

Average

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

Valuation

60/ 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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

8.3x

PEG

—

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 20.9% to 9.3% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 31.4% to 14.1% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴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.
🟡Debt is increasingFinancial
Total debt is up 41% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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?

The debt load needs earnings to hold up
Debt is 3.9x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 20.9% to 9.3%. 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.

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

1Revenue growth stays above 9% a year✓ 11.8% CAGR
Latest reported year was 30.5%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 3%✓ 5.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 3.9x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹4 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 2.8x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

5 / 9 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
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

2 good · 8 neutral · 1 weak

Market Cap

₹16 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

9.3%

Moderate

Moderate capital efficiency

ROCE

14.1%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.83x

Moderate

Moderate leverage

Revenue Growth (YoY)

30.5%

Healthy

Healthy top-line growth

Profit Growth (YoY)

56.1%

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

Gross Margin

9.0%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

2.3%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.09

Adequate

Adequate, but no real cushion

Technical Snapshot

SMA 20 / SMA 50

40.6 / 38.0

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

100.0

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹50 Cr	₹41 Cr	₹54 Cr	₹70 Cr	+11.8%
EBITDA	₹3 Cr	₹3 Cr	₹3 Cr	₹4 Cr	+12.9%
EBITDA Margin	5.1%	6.4%	5.2%	5.2%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹1 Cr	₹2 Cr	+15.0%
EPS	₹2.64	₹2.49	—	—	—
ROE	20.9%	6.0%	6.6%	9.3%	—
ROCE	31.4%	14.4%	15.6%	14.1%	—
Total Debt	₹10 Cr	₹6 Cr	₹9 Cr	₹14 Cr	+12.3%
Free Cash Flow	-₹3 Cr	-₹4 Cr	-₹1 Cr	-₹4 Cr	—

🟢 Revenue has grown at 11.8% a year over 3 years.

🟢 EBITDA has grown at 12.9% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 5.2% over 3 years.

🟢 PAT (Net Profit) has grown at 15.0% a year over 3 years.

🔴 ROE has fallen from 20.9% to 9.3% over 3 years (-11.5 pts).

🔴 ROCE has fallen from 31.4% to 14.1% over 3 years (-17.3 pts).

🔴 Total Debt has grown at 12.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹42 Cr

Total Liabilities

₹24 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹7 Cr

Capex

-₹12 Cr

Recent News

6 general

Price to sales forward of Saroja Pharma Industries India Ltd. – NSE:SAROJA

TradingView, 16 Oct

SAROJA PHARMA INDUSTRIES INDIA LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 15 Oct

Anka India Limited Announces Key Leadership Appointments Across Board and Management

scanx.trade, 05 Mar

Saroja Pharma Industries India Ltd Peer Comparison – Compare with Others

Value Research, 30 Aug

Saroja Pharma IPO Date, Review, Price, Allotment Details

IPO Watch, 29 Aug

Centuple Global (BSE:531099) - Stock Analysis

Simply Wall Street, 29 May

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
Sector/industry classification unavailable — verify manually for peer comparison.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

StrongGrowth

MiddlingFinancial Health · Valuation

WeakBusiness Quality · Profitability · Risk

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. 1 high-severity red flag sits above this conclusion and should be read first.

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