Shardul Securities Limited

Financial Services — Capital Markets · NSE

₹58.44+₹1.56 (+2.74%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by 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. Cash generation is currently 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 Shardul Securities Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Shardul Securities Limited, a non-banking financial company, engages in the investment and financing business in India.

IndustryCapital Markets

SectorFinancial Services

Employees10

Annual revenue₹40 Cr

How does it make money?

Turns over ₹40 Cr a year. Of every ₹100 of sales, about ₹-122 reaches shareholders as profit, with ₹-120 left at the operating level before interest, tax and depreciation. Each of its 10 employees supports ₹4.03 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹4.03 Cr

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC LIFE INS CO LTD, SBI LIFE INSURANCE CO LTD. 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?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE13.7%

DalalBaazaar Score

59/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of 0.79 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Trading within 10% of its 52-week high — entries here carry more pullback risk
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

58/ 100

Average

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

Valuation

78/ 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

22.1x

Sector Median

58.4x

median of 3 sector peers

🟢Against its sector it trades 62% below the peer median of 58.4x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

58.4x median of 3 peers · -62%

vs. generic bands

Fair

15x–35x

EV/EBITDA

—

PEG

—

What's Good / What's Bad

🟢 What's Going Well1

Margins are improving
EBITDA margin is up from -246.9% to -119.6% over 3 years.

🔴 What Needs Attention3

Return on equity is falling
ROE has dropped from 0.5% to -7.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 0.6% to -5.2% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 3229% against revenue growth of 3158% — customers are taking longer to pay.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only -3.2x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹49 Cr in the latest reported year.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 38.9x to -3.2x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -246.9% to -119.6%. 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 62% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

Returns on shareholder capital are falling
ROE has dropped from 0.5% to -7.5%. 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
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 -122%✓ -119.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Return on equity stays above 8%✗ -7.5%
For a lender this is the cleanest single read on whether the book is being grown profitably.
3Interest cover stays above 3x✗ -3.2x
How much operating profit can fall before interest stops being comfortably covered.

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

5 good · 3 neutral · 3 weak

Market Cap

₹511 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

22.1x

Fair

Fairly valued against the generic band

P/B Ratio

0.78x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹2.65

Profitable

Profitable on a per-share basis

ROE

-7.5%

Weak

Weak capital efficiency

ROCE

-5.2%

Weak

Low return on total capital employed

Debt/Equity

0.42x

Low

Conservative leverage

Revenue Growth (YoY)

95.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

102.9%

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

-₹26 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

97.5%

Good

Healthy core-business profitability

Net Margin

25.9%

Good

Strong bottom-line conversion

Current Ratio

44.53

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.79

Defensive

Steadier than the market

52W Range Position

96%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

56.7 / 53.7

Bullish alignment (short > long)

RSI (14)

63.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	-₹1 Cr	₹101 Cr	-₹7 Cr	₹40 Cr	—
EBITDA	₹3 Cr	₹163 Cr	₹46 Cr	-₹48 Cr	—
EBITDA Margin	-246.9%	160.9%	-685.1%	-119.6%	—
PAT (Net Profit)	₹2 Cr	₹98 Cr	₹33 Cr	-₹49 Cr	—
EPS	₹0.25	₹11.18	₹3.77	₹-5.62	—
ROE	0.5%	14.6%	4.7%	-7.5%	—
ROCE	0.6%	23.5%	6.2%	-5.2%	—
Total Debt	—	₹10 Cr	₹23 Cr	₹274 Cr	—
Free Cash Flow	-₹18 Cr	₹19 Cr	-₹40 Cr	-₹26 Cr	—

🟢 Revenue has turned positive, from -₹1 Cr to ₹40 Cr.

🔴 EBITDA has turned negative, from ₹3 Cr to -₹48 Cr.

🟢 EBITDA Margin has risen from -246.9% to -119.6% over 3 years (+127.4 pts).

🔴 PAT (Net Profit) has turned negative, from ₹2 Cr to -₹49 Cr.

🔴 EPS has turned negative, from ₹0.25 to ₹-5.62.

🔴 ROE has fallen from 0.5% to -7.5% over 3 years (-8.0 pts).

🔴 ROCE has fallen from 0.6% to -5.2% over 3 years (-5.8 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹934 Cr

Total Liabilities

₹277 Cr

Cash & Equivalents

₹8 Cr

Operating Cash Flow

-₹23 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

52.2%

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC LIFE INS CO LTD	58.4x	11.3%
SBI LIFE INSURANCE CO LTD	63.9x	13.7%

Recent News

2 positive1 mixed3 general

Shardul Securities files offer for ₹115.20 crore share buyback at ₹60

scanx.trade, 12 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Shardul Securities: ₹60 के भाव पर बायबैक का ऐलान, निवेशकों के लिए बड़ी खबर

Whalesbook, 12 Oct

Shardul Securities Share Price Jumps 20.00% on Q1 Results

Univest, 13 JulPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Shardul Securities shareholders clear Rs 115.20 crore buy-back at Rs 60 per share

Dalal Street Investment Journal, 01 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Shardul Securities (SHARDUL.NS) Edges Up 1.57% to ₹54.91, Approaching Key Resistance - PCR Moving Average

siam.in, 10 Sept

Shardul Securities Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 31 Aug

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Growth

WeakProfitability · 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. 2 high-severity red flags sit above this conclusion and should be read first.

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