Shalimar Paints Limited

Basic Materials — Specialty Chemicals · NSE

₹79.70−₹1.77 (−2.17%)

DalalBaazaar Score

35 / 100

🔴 Weak

Verdict

CAUTION

Risk

High

Driven by short-term liabilities exceed short-term assets, the company is currently loss-making, micro-cap size, which brings thin liquidity.

In simple words: The company is currently losing money, but sales are shrinking. Short-term liquidity is the main factor to watch.

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 Shalimar Paints Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Shalimar Paints Limited engages in the manufacturing and marketing of paints and coatings in India, Nepal, the United Arab Emirates, Bhutan, Seychelles, and internationally.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees599

Annual revenue₹573 Cr

How does it make money?

Turns over ₹573 Cr a year. Of every ₹100 of sales, about ₹-11 reaches shareholders as profit, with ₹-4 left at the operating level before interest, tax and depreciation. Each of its 599 employees supports ₹95.6 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹95.6 lakh

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?Little sign of one

Returns on capital of -17.8% 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 ROE22.3%

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 +51% 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+51%

DalalBaazaar Score

35/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✗ ROE has fallen by 15.6 points over the period

Quality vs. Valuation

Company Quality

33/ 100

Weak

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

Valuation

29/ 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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

—

PEG

—

What's Good / What's Bad

🟢 What's Going Well1

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.

🔴 What Needs Attention3

Margins are compressing
EBITDA margin has slipped from -2.2% to -4.0% over 3 years.
Return on equity is falling
ROE has dropped from -10.3% to -25.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from -6.2% to -17.8% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only -2.6x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹65 Cr in the latest reported year.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.88 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

No clear supporting case emerges from the available numbers.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from -2.2% to -4.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Growth barely outpaces inflation
Revenue compounding at 5.9% 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 -10.3% to -25.9%. 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.
Several serious flags at once
2 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

1EBITDA margin holds above -6%✓ -4.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Interest cover stays above 3x✗ -2.6x
How much operating profit can fall before interest stops being comfortably covered.
3Revenue growth stays above 4% a year✓ 5.9% CAGR
Latest reported year was -10.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Free cash flow remains positive✓ ₹13 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ -17.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 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

2 good · 4 neutral · 5 weak

Market Cap

₹667 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

2.66x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹-8.29

Loss-making

Negative earnings per share — the business is losing money

ROE

-25.9%

Weak

Weak capital efficiency

ROCE

-17.8%

Weak

Low return on total capital employed

Debt/Equity

0.66x

Moderate

Moderate leverage

Revenue Growth (YoY)

-10.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

20.0%

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

₹13 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

-12.5%

Weak

Thin margins leave little room for error

Net Margin

-12.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.88

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.25

Defensive

Steadier than the market

52W Range Position

73%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

78.5 / 81.5

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

57.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹482 Cr	₹531 Cr	₹598 Cr	₹573 Cr	+5.9%
EBITDA	-₹11 Cr	-₹50 Cr	-₹53 Cr	-₹23 Cr	—
EBITDA Margin	-2.2%	-9.4%	-8.8%	-4.0%	—
PAT (Net Profit)	-₹36 Cr	-₹74 Cr	-₹81 Cr	-₹65 Cr	—
EPS	₹-5.01	₹-9.52	₹-9.7	₹-7.76	—
ROE	-10.3%	-18.8%	-25.8%	-25.9%	—
ROCE	-6.2%	-14.9%	-19.7%	-17.8%	—
Total Debt	₹140 Cr	₹106 Cr	₹164 Cr	₹165 Cr	+5.6%
Free Cash Flow	-₹59 Cr	-₹40 Cr	-₹92 Cr	₹13 Cr	—

🟢 Revenue has grown at 5.9% a year over 3 years.

🔴 EBITDA Margin has fallen from -2.2% to -4.0% over 3 years (-1.8 pts).

🔴 ROE has fallen from -10.3% to -25.9% over 3 years (-15.6 pts).

🔴 ROCE has fallen from -6.2% to -17.8% over 3 years (-11.6 pts).

🔴 Total Debt has grown at 5.6% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹59 Cr to ₹13 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹641 Cr

Total Liabilities

₹389 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹23 Cr

Capex

-₹10 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

75.1%

Corporate Actions

Ex-Dividend Date

09 Jul 2012

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

6 general

Shalimar Paints (NSEI:SHALPAINTS) - Stock Analysis

Simply Wall Street, 14 Oct

Shalimar Paints' 20% spike days before Hella Infra share-swap disclosure risks regulatory scrutiny

Livemint, 19 Aug

Infra Market skips IPO, takes backdoor route via listed subsidiary Shalimar Paints

Moneycontrol.com, 13 Aug

Infra.Market's Backdoor Listing: What the Filing Hides

UnlistedZone, 13 Aug

Shalimar Paints FY26 net loss narrows to ₹63.34 crore; AGM on Sept 9

scanx.trade, 18 Aug

Outcome of board meeting of Shalimar Paints

Business Standard, 13 Aug

Watch Items

Revenue growth is negative (-10.3%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

MiddlingFinancial Health · Risk

WeakBusiness Quality · Growth · Profitability · Valuation

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 2 high-severity red flags sit above this conclusion and should be read first.

2 of 5 tripwires tripped — Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑