Sharda Cropchem Limited

Basic Materials — Agricultural Inputs · NSE

₹725.00+₹0.95 (+0.13%)

DalalBaazaar Score

80 / 100

🟢 Strong

Verdict

ATTRACTIVE

Risk

Low

Driven by small-cap size, which brings sharper price swings, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Sharda Cropchem Limited, a crop protection chemical company, engages in the provision of various formulations and generic active ingredients worldwide. The company operates through Agrochemicals and Non- Agrochemicals segments.

IndustryAgricultural Inputs

SectorBasic Materials

Employees500

Annual revenue₹5,264 Cr

How does it make money?

Turns over ₹5,264 Cr a year. Of every ₹100 of sales, about ₹13 reaches shareholders as profit, with ₹23 left at the operating level before interest, tax and depreciation. Each of its 500 employees supports ₹10.53 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin23.0%

Net margin12.9%

Revenue / employee₹10.53 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?Some evidence

ROCE of 25.3% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE25.3%

ROE21.7%

Peer median ROE22.3%

What is the outlook?

5 analysts covering the stock expect revenue to grow about 11.8% and earnings to grow about 10.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+11.8%

Est. earnings growth+10.8%

Analysts5

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +30% while net margin moved +53% 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+30%

Margin effect+53%

DalalBaazaar Score

80/ 100

Strong

Weighted across six categories. Every point is explained below.

✓ Beta of 0.60 — historically steadier than the index
✗ Small Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

85/ 100

Excellent

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

Valuation

85/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

10.4x

3Y Median

25.8x

40 monthly readings · mean 71.8x · range 8.5x–322.3x

Sector Median

28.7x

median of 4 sector peers

🟢Current valuation is approximately 59% below its 3y median of 25.8x. 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 64% below the peer median of 28.7x.

vs. its own history

Cheap

25.8x median over 40 months · -59%

vs. sector peers

Cheap

28.7x median of 4 peers · -64%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

10.4x

P/B

2.09x

EV/EBITDA

5.2x

PEG

0.40

Dividend Yield

2.07%

What's Good / What's Bad

🟢 What's Going Well8

Margins are improving
EBITDA margin is up from 17.3% to 23.0% over 3 years.
Cash generation is improving
Free cash flow is up 88% over 3 years.
Return on equity is rising
ROE has improved from 15.3% to 21.7%.
Return on capital is rising
ROCE has improved from 18.3% to 25.3%.
High return on capital employed
ROCE of 25.3% is the mark of a business that converts capital into profit efficiently.
Valuation below its historical average
At 10.4x the stock trades 59% below its own median of 25.8x.
Very low debt
Debt/Equity of 0.10x leaves the balance sheet with plenty of headroom.
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

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 25.3% 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 17.3% to 23.0%. 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 59% 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 64% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹158 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.

🔴 Bear CaseWhat could go wrong?

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
Small 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 21%✓ 23.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 7% a year✓ 9.2% CAGR
Latest reported year was 4.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹158 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 22%✓ 25.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 25.8x✓ 10.4x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

10 / 12 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
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

7 good · 3 neutral · 1 weak

Market Cap

₹6,541 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.4x

Cheap

Cheap against the generic band

P/B Ratio

2.09x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹69.41

Profitable

Profitable on a per-share basis

ROE

21.7%

Strong

Strong capital efficiency

ROCE

25.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.10x

Low

Conservative leverage

Revenue Growth (YoY)

4.9%

Modest

Modest growth

Profit Growth (YoY)

-38.3%

Falling

Profits are shrinking

Dividend Yield

2.07%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹158 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹725

P/E (Forward)

8.8x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

4.0%

Weak

Thin margins leave little room for error

Net Margin

11.9%

Good

Strong bottom-line conversion

Current Ratio

1.86

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.60

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

732.3 / 761.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

39.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,040 Cr	₹3,160 Cr	₹4,315 Cr	₹5,264 Cr	+9.2%
EBITDA	₹700 Cr	₹375 Cr	₹713 Cr	₹1,211 Cr	+20.0%
EBITDA Margin	17.3%	11.9%	16.5%	23.0%	—
PAT (Net Profit)	₹342 Cr	₹32 Cr	₹304 Cr	₹681 Cr	+25.8%
EPS	₹37.9	₹3.53	₹33.74	₹75.47	+25.8%
ROE	15.3%	1.4%	12.2%	21.7%	—
ROCE	18.3%	3.1%	13.9%	25.3%	—
Total Debt	₹3 Cr	₹18 Cr	₹8 Cr	—	—
Free Cash Flow	₹84 Cr	₹69 Cr	₹211 Cr	₹158 Cr	+23.4%

🟢 Revenue has grown at 9.2% a year over 3 years.

🟢 EBITDA has grown at 20.0% a year over 3 years.

🟢 EBITDA Margin has risen from 17.3% to 23.0% over 3 years (+5.7 pts).

🟢 PAT (Net Profit) has grown at 25.8% a year over 3 years.

🟢 EPS has grown at 25.8% a year over 3 years.

🟢 ROE has risen from 15.3% to 21.7% over 3 years (+6.4 pts).

🟢 ROCE has risen from 18.3% to 25.3% over 3 years (+7.0 pts).

🟢 Free Cash Flow has grown at 23.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹5,780 Cr

Total Liabilities

₹2,643 Cr

Total Debt

—

Cash & Equivalents

₹220 Cr

Operating Cash Flow

₹656 Cr

Capex

-₹497 Cr

Shareholding (proxy)

Institutional Holding

10.1%

Insider Holding

74.8%

Corporate Actions

Dividend Rate

₹15

Ex-Dividend Date

07 Aug 2026

Analyst Consensus

Recommendations

5 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,196

+65.0% vs CMP

Target Range

₹1,061 – ₹1,350

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 positive3 mixed2 general

Sharda Cropchem Q1FY27 revenue rises 9%, net profit dips on forex

scanx.trade, 18 OctResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Sharda Cropchem (NSEI:SHARDACROP) - Stock Analysis

Simply Wall Street, 16 Oct

SHARDACROP Forecast — Price Target — Prediction for 2027

TradingView, 26 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Sharda Cropchem Share Price Near Yearly Low, Key Metrics

Univest, 30 Sept

Sharda Cropchem (NSEI:SHARDACROP) Stock Forecast & Analyst Predictions

Simply Wall Street, 12 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Sharda Cropchem slides as Q1 PAT tanks 38% YoY to Rs 88 cr

Business Standard, 29 JulResults

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

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟢Business QualityStrong16.7/20

🟢Financial HealthStrong17.8/20

🟢GrowthStrong16.1/20

🟢ProfitabilityStrong12.9/15

🟢ValuationAttractive11.8/15

🟡RiskModerate4.9/10

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last.

This thesis breaks if

✓EBITDA margin holds above 21%23.0%
✓Revenue growth stays above 7% a year9.2% CAGR
✓Free cash flow remains positive₹158 Cr
✓ROCE stays above 22%25.3%
✓Valuation vs its own median of 25.8x10.4x today