Sikko Industries Limited

Basic Materials — Agricultural Inputs · NSE

₹5.98−₹0.07 (−1.16%)

DalalBaazaar Score

53 / 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, but sales are shrinking. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:48 pm

Understanding the Business

Company site ↗

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

What does this company do?

Sikko Industries Limited manufactures and trades in pesticides, bio agrochemicals, NPK fertilizers products in india and internationally.

IndustryAgricultural Inputs

SectorBasic Materials

Employees112

Annual revenue₹65 Cr

How does it make money?

Turns over ₹65 Cr a year. Of every ₹100 of sales, about ₹8 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 112 employees supports ₹58.0 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹58.0 lakh

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.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 8.1% 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?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +31% while net margin moved +35% 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+35%

DalalBaazaar Score

53/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROCE of 8.1% is below 10% — capital is not working hard
✗ ROCE has fallen by 9.7 points — returns are eroding
✗ EBITDA margin of 11.4% is thin — little cushion if costs rise
• Net margin of 9.4% is reasonable
• Revenue has compounded at 9.4% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

55/ 100

Average

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

Valuation

37/ 100

Expensive

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

42.7x

3Y Median

38.3x

40 monthly readings · mean 37.7x · range 15.2x–65.5x

Sector Median

28.7x

median of 4 sector peers

⚠️Current valuation is approximately 12% above its 3y median of 38.3x. 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 49% above the peer median of 28.7x.

vs. its own history

Fair

38.3x median over 40 months · +12%

vs. sector peers

Expensive

28.7x median of 4 peers · +49%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

36.7x

PEG

2.05

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.14x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 12.1% to 5.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 17.8% to 8.1% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 1 high · 3 watch

🔴Inventory building faster than salesFinancial
Inventory up 112% against revenue up 31% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 36% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹10 Cr in the latest year.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 29% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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?

A premium to the sector to defend
It trades 49% above the peer median. That premium needs a reason that persists, or it closes.
Returns on shareholder capital are falling
ROE has dropped from 12.1% to 5.9%. 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.

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

1EBITDA margin holds above 9%✓ 11.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹10 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 7% a year✓ 9.4% CAGR
Latest reported year was -2.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 1.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✓ 8.1%
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

3 good · 4 neutral · 4 weak

Market Cap

₹261 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

42.7x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.78x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.14

Profitable

Profitable on a per-share basis

ROE

5.9%

Weak

Weak capital efficiency

ROCE

8.1%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.14x

Low

Conservative leverage

Revenue Growth (YoY)

-2.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

40.0%

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

-₹10 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

24.4%

Good

Healthy core-business profitability

Net Margin

9.4%

Average

Average bottom-line conversion

Current Ratio

3.44

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.07

Defensive

Steadier than the market

52W Range Position

74%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

6.1 / 5.7

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

31.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹50 Cr	₹61 Cr	₹62 Cr	₹65 Cr	+9.4%
EBITDA	₹5 Cr	₹4 Cr	₹7 Cr	₹7 Cr	+13.4%
EBITDA Margin	10.2%	7.2%	11.0%	11.4%	—
PAT (Net Profit)	₹3 Cr	₹4 Cr	₹4 Cr	₹5 Cr	+20.8%
EPS	₹0.09	₹0.12	₹0.12	₹0.33	+57.1%
ROE	12.1%	14.6%	5.2%	5.9%	—
ROCE	17.8%	23.1%	7.7%	8.1%	—
Total Debt	₹9 Cr	₹6 Cr	₹4 Cr	₹12 Cr	+10.8%
Free Cash Flow	-₹6 Cr	₹1 Cr	-₹45 Cr	-₹10 Cr	—

🟢 Revenue has grown at 9.4% a year over 3 years.

🟢 EBITDA has grown at 13.4% a year over 3 years.

🟢 EBITDA Margin has risen from 10.2% to 11.4% over 3 years (+1.2 pts).

🟢 PAT (Net Profit) has grown at 20.8% a year over 3 years.

🟢 EPS has grown at 57.1% a year over 3 years.

🔴 ROE has fallen from 12.1% to 5.9% over 3 years (-6.2 pts).

🔴 ROCE has fallen from 17.8% to 8.1% over 3 years (-9.7 pts).

🔴 Total Debt has grown at 10.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹115 Cr

Total Liabilities

₹29 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹7 Cr

Capex

-₹2 Cr

Corporate Actions

Ex-Dividend Date

28 Dec 2022

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 positive5 general

Sikko Industries Upper Circuit Streak: Day 2 Price and Data

Univest, 14 Oct

Price Band Hitters, August 13, 2026, 3:30 PM IST

HDFC Sky, 13 Aug

Sikko Industries Ltd. Upper Circuit Today: Price, Data and Peers

Univest, 24 Sept

Last day to buy Sikko Industries shares ahead of 10:1 stock split

The Economic Times, 26 NovCapital return

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

ADVANCE Stock Price and Chart — NSE:ADVANCE

TradingView, 14 Jul

Sikko Industries Share Price Forecast to 2030

Univest, 29 Jul

Watch Items

Revenue growth is negative (-2.3%) 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

StrongFinancial Health · Growth

MiddlingValuation · Risk

WeakBusiness Quality · Profitability

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. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑