SHAKTI POLYTARP LIMITED

Basic Materials — Specialty Chemicals · BSE

₹53.50−₹0.05 (−0.09%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Very High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, negative free cash flow.

In simple words: Strong business and financial position, 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, 7:46 pm

Understanding the Business

Company site ↗

The 60-second version of SHAKTI POLYTARP LIMITED — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Shakti Polytarp Limited engages in the manufacturing of tarpaulin and solutions customized to the bulk packaging requirements. The company offers a range of tarpaulin products, such as geotextile, lumber wrap, house wraps, pond liners, and green net.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees114

Annual revenue₹216 Cr

How does it make money?

Turns over ₹216 Cr a year. Of every ₹100 of sales, about ₹5 reaches shareholders as profit, with ₹9 left at the operating level before interest, tax and depreciation. Each of its 114 employees supports ₹1.89 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.89 Cr

Who are its competitors?

The closest listed comparisons in its industry are ASIAN PAINTS LIMITED, PIDILITE INDUSTRIES LTD, SRF LTD, UPL 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 28.5% 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 ROE22.3%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +367% while net margin moved +284% 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+367%

Margin effect+284%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ 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

59/ 100

Average

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

Valuation

79/ 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

9.1x

Sector Median

40.4x

median of 4 sector peers

🟢Against its sector it trades 77% below the peer median of 40.4x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

40.4x median of 4 peers · -77%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.4x

PEG

0.06

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 6.3% to 9.1% over 3 years.
Return on equity is rising
ROE has improved from 7.6% to 36.1%.
Return on capital is rising
ROCE has improved from 14.0% to 28.5%.
High return on capital employed
ROCE of 28.5% is the mark of a business that converts capital into profit efficiently.
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

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 332% over 3 years, from ₹17 Cr to ₹73 Cr.
🔴High leverageFinancial
Debt/Equity of 2.60x — 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.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.86 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 28.5% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 6.3% to 9.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 77% 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?

The debt load needs earnings to hold up
Debt is 3.7x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
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 50% a year✓ 67.1% CAGR
Latest reported year was 29.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 7%✓ 9.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 3.7x
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✗ -₹21 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 26%✓ 28.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 10 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

Price history

Quick Metrics

6 good · 3 neutral · 2 weak

Market Cap

₹92 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

9.1x

Cheap

Cheap against the generic band

P/B Ratio

2.41x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.87

Profitable

Profitable on a per-share basis

ROE

44.0%

Strong

Strong capital efficiency

ROCE

28.5%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

2.60x

High

High leverage

Revenue Growth (YoY)

29.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

102.5%

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

-₹22 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

12.0%

Good

Assets are working hard

Operating Margin

8.1%

Average

Average margins

Net Margin

4.7%

Average

Average bottom-line conversion

Current Ratio

0.86

Adequate

Adequate, but no real cushion

52W Range Position

60%

Mid-range

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹46 Cr	₹62 Cr	₹166 Cr	₹216 Cr	+67.1%
EBITDA	₹3 Cr	₹4 Cr	₹11 Cr	₹20 Cr	+89.1%
EBITDA Margin	6.3%	6.0%	6.4%	9.1%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹5 Cr	₹10 Cr	+161.7%
EPS	₹0.31	₹0.57	₹2.9	—	—
ROE	7.6%	9.1%	27.9%	36.1%	—
ROCE	14.0%	14.5%	25.8%	28.5%	—
Total Debt	₹17 Cr	₹24 Cr	₹48 Cr	₹73 Cr	+62.9%
Free Cash Flow	-₹4 Cr	-₹5 Cr	-₹18 Cr	-₹21 Cr	—

🟢 Revenue has grown at 67.1% a year over 3 years.

🟢 EBITDA has grown at 89.1% a year over 3 years.

🟢 EBITDA Margin has risen from 6.3% to 9.1% over 3 years (+2.8 pts).

🟢 PAT (Net Profit) has grown at 161.7% a year over 3 years.

🟢 ROE has risen from 7.6% to 36.1% over 3 years (+28.5 pts).

🟢 ROCE has risen from 14.0% to 28.5% over 3 years (+14.5 pts).

🔴 Total Debt has grown at 62.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹110 Cr

Total Liabilities

₹82 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹13 Cr

Capex

-₹34 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

78.4%

Peer Comparison

Company	P/E	ROE
ASIAN PAINTS LIMITED	46.9x	22.3%
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

1 mixed5 general

Compare with

Equitymaster, 16 Oct

SHAKTI POLYTARP LIMITED Lower Circuit Today: Price, Data and Peers

Univest, 25 Sept

Shakti Polytarp Limited (544933) Company Information

Simply Wall Street, 22 Sept

Shakti Polytarp Q1 Results 2026 - Find Shakti Polytarp Q1 Earnings Result | Shakti Polytarp Q1 results

Livemint, 23 SeptResults

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

Shakti Polytarp Ltd. IPO Review - Shakti Polytarp Ltd. IPO Dates, Issue Price, Subscription and Allotment Status

The Economic Times, 22 Sept

BSE SME Shakti Polytarp keeps its head above water on debut

Business Standard, 22 Sept

Watch Items

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

DalalBaazaar Thesis

StrongGrowth · Profitability · Valuation

MiddlingBusiness Quality

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

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