SC Agrotech Limited

Basic Materials — Agricultural Inputs · BSE

₹32.00−₹1.50 (−4.48%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, 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. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:05 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

SC Agrotech Limited engages in the business of seeds, fertilizers, pesticides, contract farming, and agro-processing business in India. It offers greenhouse technology and organic farming services.

IndustryAgricultural Inputs

SectorBasic Materials

Employees6

Annual revenue₹88 Cr

How does it make money?

Turns over ₹88 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹5 left at the operating level before interest, tax and depreciation. Each of its 6 employees supports ₹14.68 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin5.3%

Net margin3.8%

Revenue / employee₹14.68 Cr

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.

TATA STEEL LIMITEDP/E 19.8x · ROE 10.8%

JSW STEEL LIMITEDP/E 12.0x · ROE 24.7%

ULTRATECH CEMENT LIMITEDP/E 37.6x · ROE 11.1%

ASIAN PAINTS LIMITEDP/E 46.9x · ROE 22.3%

What is its competitive advantage?Little sign of one

Returns on capital of 3.7% 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.

ROCE3.7%

ROE2.8%

Peer median ROE22.3%

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 +99198% while net margin moved -100% 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+99198%

Margin effect-100%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of 0.04 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

56/ 100

Average

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.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

11.0x

3Y Median

41.3x

40 monthly readings · mean 41.4x · range 4.0x–94.8x

Sector Median

28.7x

median of 4 sector peers

🟢Current valuation is approximately 73% below its 3y median of 41.3x. 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 62% below the peer median of 28.7x.

vs. its own history

Cheap

41.3x median over 40 months · -73%

vs. sector peers

Cheap

28.7x median of 4 peers · -62%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

11.0x

P/B

2.05x

EV/EBITDA

54.0x

PEG

0.58

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from -3802.5% to 5.3% over 3 years.
Return on capital is rising
ROCE has improved from -34.1% to 3.7%.
Valuation below its historical average
At 11.0x the stock trades 73% below its own median of 41.3x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 82.5% to 2.8% — each rupee of shareholder capital earns less than it did.

Red Flags

4 items require attention · 3 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 8.56x — earnings must service borrowings before shareholders see anything.
🔴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.
🔴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.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 1168% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -3802.5% to 5.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 73% 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 62% 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?

Leverage amplifies any setback
Debt/Equity of 8.56x. Interest is payable whether or not the business has a good year.
Returns on shareholder capital are falling
ROE has dropped from 82.5% to 2.8%. 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.
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

1Revenue growth stays above 673% a year✓ 897.7% CAGR
Latest reported year was 1672.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 3%✓ 5.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹107 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ 3.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

4 good · 3 neutral · 4 weak

Market Cap

₹243 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

11.0x

Cheap

Cheap against the generic band

P/B Ratio

2.05x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹2.91

Profitable

Profitable on a per-share basis

ROE

2.8%

Weak

Weak capital efficiency

ROCE

3.7%

Weak

Low return on total capital employed

Debt/Equity

8.56x

High

High leverage

Revenue Growth (YoY)

1672.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

4100.0%

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

-₹107 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹32

Operating Margin

33.7%

Good

Healthy core-business profitability

Net Margin

10.4%

Good

Strong bottom-line conversion

Current Ratio

14.39

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.04

Defensive

Steadier than the market

52W Range Position

59%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

33.5 / 30.7

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

52.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹0 Cr	₹1 Cr	—	₹88 Cr	+897.7%
EBITDA	-₹3 Cr	-₹1 Cr	-₹1 Cr	₹5 Cr	—
EBITDA Margin	-3802.5%	-130.8%	—	5.3%	—
PAT (Net Profit)	₹2 Cr	₹0 Cr	₹0 Cr	₹3 Cr	+18.8%
EPS	₹3.32	₹0.4	—	—	—
ROE	82.5%	9.0%	7.1%	2.8%	—
ROCE	-34.1%	-21.1%	7.4%	3.7%	—
Free Cash Flow	-₹1 Cr	-₹1 Cr	-₹1 Cr	-₹107 Cr	—

🟢 Revenue has grown at 897.7% a year over 3 years.

🟢 EBITDA has turned positive, from -₹3 Cr to ₹5 Cr.

🟢 EBITDA Margin has risen from -3802.5% to 5.3% over 3 years (+3807.8 pts).

🟢 PAT (Net Profit) has grown at 18.8% a year over 3 years.

🔴 ROE has fallen from 82.5% to 2.8% over 3 years (-79.6 pts).

🟢 ROCE has risen from -34.1% to 3.7% over 3 years (+37.7 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹136 Cr

Total Liabilities

₹18 Cr

Total Debt

₹10 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹107 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

88.8%

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 mixed5 general

SC Agrotech Lower Circuit Today: Price, Data and Peers

Univest, 12 Oct

SC Agrotech Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 30 Aug

SC Agrotech Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

SC Agrotech board approves AGM notice, office shift to Gujarat

scanx.trade, 07 Sept

SC Agrotech Q1 FY27 Results: Revenue Rs 37 Cr, PAT Rs 9 Cr and Key Highlights

Univest, 11 AugResults

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

SC Agrotech Ltd. Financials – Balance Sheet, Profit & Loss, Cash Flow

Value Research, 30 Aug

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate10.2/20

🟡Financial HealthAdequate10.6/20

🟢GrowthStrong14.7/20

🟡ProfitabilityModerate6.9/15

🟢ValuationAttractive11.8/15

🔴RiskHigh3.7/10

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

This thesis breaks if

✓Revenue growth stays above 673% a year897.7% CAGR
✓EBITDA margin holds above 3%5.3%
✗Debt / EBITDA stays below 2x2.2x
✗Free cash flow remains positive-₹107 Cr
✗ROCE stays above 8%3.7%