Shri Dinesh Mills Limited

Consumer Cyclical — Textile Manufacturing · BSE

₹390.75−₹5.50 (−1.39%)

DalalBaazaar Score

47 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by moderate debt load, 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. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

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 Shri Dinesh Mills Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Shri Dinesh Mills Limited manufactures and sells textile products in India and internationally. The company offers worsted fabrics for menswear, paper maker felts, and industrial textiles.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees247

Annual revenue₹68 Cr

How does it make money?

Turns over ₹68 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 247 employees supports ₹27.4 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹27.4 lakh

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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 4.5% 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 ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -31% while net margin moved -54% 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-31%

Margin effect-54%

DalalBaazaar Score

47/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 11.6% a year
✗ Profit has declined at 31.7% a year

Quality vs. Valuation

Company Quality

45/ 100

Average

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

Valuation

52/ 100

Fair

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

19.8x

2Y Median

12.8x

28 monthly readings · mean 12.2x · range 3.1x–28.8x

Sector Median

69.2x

median of 4 sector peers

⚠️Current valuation is approximately 55% above its 2y median of 12.8x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 71% below the peer median of 69.2x.

vs. its own history

Expensive

12.8x median over 28 months · +55%

vs. sector peers

Cheap

69.2x median of 4 peers · -71%

vs. generic bands

Fair

15x–35x

EV/EBITDA

29.0x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 83% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 15.2% to 3.8% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 15.8% to 4.5% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 watch

🟡Profit is decliningFinancial
Net profit is down 68% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 83% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 71% 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 price already assumes success
The stock trades 55% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 15.2% to 3.8%. 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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 9%✓ 11.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹2 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 8%✗ 4.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 12.8x✗ 19.8x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

8 / 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 · 4 neutral · 2 weak

Market Cap

₹219 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

19.8x

Fair

Fairly valued against the generic band

P/B Ratio

1.09x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹19.72

Profitable

Profitable on a per-share basis

ROE

3.8%

Weak

Weak capital efficiency

ROCE

4.5%

Weak

Low return on total capital employed

Debt/Equity

1.19x

Moderate

Moderate leverage

Revenue Growth (YoY)

12.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

100.9%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.38%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹2 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

12.1%

Average

Average margins

Net Margin

15.9%

Good

Strong bottom-line conversion

Current Ratio

9.69

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.40

Defensive

Steadier than the market

52W Range Position

89%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

378.9 / 373.1

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

60.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹98 Cr	₹67 Cr	₹67 Cr	₹68 Cr	-11.6%
EBITDA	₹12 Cr	₹25 Cr	₹13 Cr	₹8 Cr	-14.9%
EBITDA Margin	12.5%	36.5%	20.1%	11.1%	—
PAT (Net Profit)	₹24 Cr	₹51 Cr	₹10 Cr	₹8 Cr	-31.7%
EPS	₹42.24	₹90.25	₹18.73	₹13.57	-31.5%
ROE	15.2%	25.1%	5.4%	3.8%	—
ROCE	15.8%	29.5%	8.5%	4.5%	—
Total Debt	₹14 Cr	₹24 Cr	₹5 Cr	₹2 Cr	-44.6%
Free Cash Flow	-₹3 Cr	-₹6 Cr	-₹0 Cr	₹2 Cr	—

🔴 Revenue has shrunk at 11.6% a year over 3 years.

🔴 EBITDA has shrunk at 14.9% a year over 3 years.

🔴 EBITDA Margin has fallen from 12.5% to 11.1% over 3 years (-1.3 pts).

🔴 PAT (Net Profit) has shrunk at 31.7% a year over 3 years.

🔴 EPS has shrunk at 31.5% a year over 3 years.

🔴 ROE has fallen from 15.2% to 3.8% over 3 years (-11.4 pts).

🔴 ROCE has fallen from 15.8% to 4.5% over 3 years (-11.3 pts).

🟢 Total Debt has shrunk at 44.6% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹3 Cr to ₹2 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹229 Cr

Total Liabilities

₹29 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹1 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

65.9%

Corporate Actions

Dividend Rate

₹1.5

Ex-Dividend Date

07 Aug 2026

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

1 mixed5 general

Compare with SHRI DINESH

Equitymaster, 16 Oct

Shri Dinesh Mills Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 29 Aug

Shri Dinesh Mills Board Approves In-Principle Demerger of FELT Business

scanx.trade, 29 Apr

Bannari Amman Spinning Mills (NSEI:BASML) - Stock Analysis

Simply Wall Street, 14 Oct

Shri Dinesh Mills publishes postal ballot notice for real estate expansion

scanx.trade, 18 SeptCapacity

🟡Mixed / dependsCapacity additions can raise revenue over two to three years, but the capital spend usually pressures free cash flow first. Worth checking whether the capex is funded from operations or from borrowing.

Compare SHRI DINESH with

Equitymaster, 12 Oct

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health

MiddlingProfitability · Valuation

WeakBusiness Quality · Growth · 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 of 5 tripwires tripped — ROCE stays above 8%; Valuation vs its own median of 12.8x · see Key things to watch ↑