SBEC Systems (India) Limited

Industrials — Specialty Industrial Machinery · BSE

₹19.73+₹1.07 (+5.73%)

DalalBaazaar Score

24 / 100

🔴 Weak

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, negative free cash flow.

In simple words: The company owes more than it owns — years of losses have wiped out its net worth, though profits are falling even as sales grow. 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, 7:00 pm

Understanding the Business

Company site ↗

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

What does this company do?

SBEC Systems (India) Limited operates as an engineering and consultancy company in India.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Annual revenue₹3 Cr

How does it make money?

Turns over ₹3 Cr a year. Of every ₹100 of sales, about ₹44 reaches shareholders as profit, with ₹67 left at the operating level before interest, tax and depreciation.

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, LARSEN & TOUBRO LTD., HAVELLS INDIA 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?Some evidence

ROCE of 57.4% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE17.1%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +10% while net margin moved +25% 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+10%

Margin effect+25%

DalalBaazaar Score

24/ 100

Weak

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

25/ 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.

Historical Valuation

Current P/E

13.3x

3Y Median

17.5x

40 monthly readings · mean 18.4x · range 6.4x–49.5x

Sector Median

66.2x

median of 4 sector peers

🟢Current valuation is approximately 24% below its 3y median of 17.5x. 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 80% below the peer median of 66.2x.

vs. its own history

Cheap

17.5x median over 40 months · -24%

vs. sector peers

Cheap

66.2x median of 4 peers · -80%

vs. generic bands

N/A

Multiples unreliable — equity base is negative

EV/EBITDA

19.2x

PEG

1.21

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

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

Red Flags

7 items require attention · 3 high · 4 watch

🔴Negative shareholders' equityFinancial
Liabilities exceed assets — accumulated losses have wiped out the company's net worth.
🔴Thin interest coverageFinancial
Operating profit covers interest only 1.1x — little room if earnings dip.
🔴Receivables growing faster than salesFinancial
Receivables up 79% against revenue up 10% — sales are being booked faster than they are collected.
🟡Debt is increasingFinancial
Total debt is up 44% over 3 years.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.5x to 1.1x.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹1 Cr in the latest year.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.20 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 24% 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 80% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 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.
The debt load needs earnings to hold up
Debt is 10.6x 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 79% against revenue up 10%. 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 3.2% 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.
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

1EBITDA margin holds above 65%✓ 66.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 10.6x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹1 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ 1.1x
How much operating profit can fall before interest stops being comfortably covered.
5Revenue growth stays above 4% a year✗ 3.2% CAGR
Latest reported year was 6.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.

Investment Checklist

4 / 10 checks passed

✗ Shareholders' equity is positive (assets exceed liabilities)
✓ Strong return on capital employed (ROCE ≥ 15%)
✗ 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

2 good · 5 neutral · 4 weak

Market Cap

₹20 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

13.3x

Cheap

Cheap against the generic band

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

₹1.48

Profitable

Profitable on a per-share basis

ROE

Not meaningful

Negative equity

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

ROCE

57.4%

Distorted

Distorted by the negative net worth — read this alongside the solvency flag, not on its own

Debt/Equity

Not meaningful

Negative equity

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

Revenue Growth (YoY)

6.4%

Modest

Modest growth

Profit Growth (YoY)

-38.0%

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

-₹1 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

0.0%

Weak

Thin margins leave little room for error

Net Margin

0.0%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.20

Tight

Tight short-term liquidity

52W Range Position

49%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

19.1 / 19.6

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

46.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3 Cr	₹3 Cr	₹3 Cr	₹3 Cr	+3.2%
EBITDA	₹2 Cr	₹2 Cr	₹3 Cr	₹2 Cr	+2.5%
EBITDA Margin	67.8%	74.6%	89.2%	66.5%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹2 Cr	₹2 Cr	+11.0%
EPS	₹1.11	₹1.33	₹2.44	₹1.51	+10.8%
ROCE	—	—	379.5%	57.4%	—
Total Debt	₹17 Cr	₹17 Cr	₹22 Cr	₹24 Cr	+12.8%
Free Cash Flow	₹2 Cr	₹1 Cr	-₹4 Cr	-₹1 Cr	—

🟢 Revenue has grown at 3.2% a year over 3 years.

🟢 EBITDA has grown at 2.5% a year over 3 years.

🔴 EBITDA Margin has fallen from 67.8% to 66.5% over 3 years (-1.3 pts).

🟢 PAT (Net Profit) has grown at 11.0% a year over 3 years.

🟢 EPS has grown at 10.8% a year over 3 years.

🔴 ROCE has fallen from 379.5% to 57.4% over 3 years (-322.2 pts).

🔴 Total Debt has grown at 12.8% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹16 Cr

Total Liabilities

₹26 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹2 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

51.0%

Corporate Actions

Ex-Dividend Date

27 Dec 1995

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
LARSEN & TOUBRO LTD.	30.1x	15.2%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

2 mixed4 general

SBEC Systems shareholders approve FY26 financials with 99.95% assent

scanx.trade, 14 Oct

SBEC Systems (India) Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 29 Aug

SJP ULTRASONICS LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 08 Oct

SBEC Systems schedules 37th AGM for September 29, 2026

scanx.trade, 01 Sept

Kitex Garments reports consolidated net loss of Rs 9.00 crore in the June 2026 quarter

Business Standard, 15 AugResults

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

SBEC Systems commissions 637 KWp solar power project in UP

scanx.trade, 15 SeptCapacity

🟡Mixed / dependsCapacity additions can raise revenue over two to three years, but the capital spend usually pressures free cash flow first. Worth checking whether the capex is funded from operations or from borrowing.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

MiddlingGrowth

WeakBusiness Quality · Financial Health · Profitability · Valuation · Risk

Points for each in the Score ↑

Avoid until solvency is resolved

SBEC Systems (India) 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.

4 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x; Revenue growth stays above 4% a year · see Key things to watch ↑