Sirca Paints India Limited

Basic Materials — Specialty Chemicals · NSE

₹426.30−₹2.85 (−0.66%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:02 pm

Understanding the Business

Company site ↗

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

What does this company do?

Sirca Paints India Limited manufactures and sells wood coatings and decorative paints in India and internationally.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees724

Annual revenue₹492 Cr

How does it make money?

Turns over ₹492 Cr a year. Of every ₹100 of sales, about ₹13 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 724 employees supports ₹68.0 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹68.0 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?Some evidence

ROCE of 17.9% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE22.3%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 15.5% and earnings to grow about 23.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+15.5%

Est. earnings growth+23.8%

Analysts2

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +84% while net margin moved -23% 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+84%

Margin effect-23%

DalalBaazaar Score

59/ 100

Moderate

Weighted across six categories. Every point is explained below.

• P/E of 35.7x already prices in growth
• P/E is close to its own historical median of 43.2x
✗ P/B of 5.10x is a steep premium to book

Quality vs. Valuation

Company Quality

62/ 100

Average

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

Valuation

42/ 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

35.7x

3Y Median

43.2x

40 monthly readings · mean 42.1x · range 25.8x–58.1x

Sector Median

40.4x

median of 4 sector peers

🟢Current valuation is approximately 17% below its 3y median of 43.2x. 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 is priced broadly in line with the peer median of 40.4x.

vs. its own history

Fair

43.2x median over 40 months · -17%

vs. sector peers

Fair

40.4x median of 4 peers · -12%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

23.5x

PEG

2.94

What's Good / What's Bad

🟢 What's Going Well2

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 17.4% to 13.7% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 23.3% to 17.9% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 6.80x — earnings must service borrowings before shareholders see anything.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Receivables growing faster than salesFinancial
Receivables up 202% against revenue up 84% — sales are being booked faster than they are collected.
🟡Margins are compressingFinancial
EBITDA margin is down 4.1 points over 3 years.

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?

Margins are being competed away
EBITDA margin has fallen from 25.0% to 20.9%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 6.80x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 202% against revenue up 84%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 17.4% to 13.7%. 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

1Revenue growth stays above 17% a year✓ 22.5% CAGR
Latest reported year was 13.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 19%✓ 20.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹17 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.4x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 15%✓ 17.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 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

5 good · 4 neutral · 2 weak

Market Cap

₹2,427 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

35.7x

Fair

Fairly valued against the generic band

P/B Ratio

5.10x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹11.94

Profitable

Profitable on a per-share basis

ROE

13.7%

Moderate

Moderate capital efficiency

ROCE

17.9%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

6.80x

High

High leverage

Revenue Growth (YoY)

13.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

10.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.47%

Modest

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

Free Cash Flow

₹17 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

24.4x

Improving

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

Operating Margin

16.6%

Good

Healthy core-business profitability

Net Margin

13.2%

Good

Strong bottom-line conversion

Current Ratio

5.21

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.25

Defensive

Steadier than the market

52W Range Position

27%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

410.5 / 425.5

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

62.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹268 Cr	₹312 Cr	₹374 Cr	₹492 Cr	+22.5%
EBITDA	₹67 Cr	₹75 Cr	₹73 Cr	₹103 Cr	+15.5%
EBITDA Margin	25.0%	24.1%	19.5%	20.9%	—
PAT (Net Profit)	₹46 Cr	₹51 Cr	₹49 Cr	₹65 Cr	+12.1%
EPS	₹8.41	₹9.38	₹8.95	₹11.63	+11.4%
ROE	17.4%	16.7%	14.0%	13.7%	—
ROCE	23.3%	22.3%	16.7%	17.9%	—
Total Debt	—	—	₹50 Cr	₹44 Cr	—
Free Cash Flow	-₹29 Cr	₹30 Cr	-₹53 Cr	₹17 Cr	—

🟢 Revenue has grown at 22.5% a year over 3 years.

🟢 EBITDA has grown at 15.5% a year over 3 years.

🔴 EBITDA Margin has fallen from 25.0% to 20.9% over 3 years (-4.1 pts).

🟢 PAT (Net Profit) has grown at 12.1% a year over 3 years.

🟢 EPS has grown at 11.4% a year over 3 years.

🔴 ROE has fallen from 17.4% to 13.7% over 3 years (-3.7 pts).

🔴 ROCE has fallen from 23.3% to 17.9% over 3 years (-5.5 pts).

🟢 Free Cash Flow has turned positive, from -₹29 Cr to ₹17 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹589 Cr

Total Liabilities

₹114 Cr

Cash & Equivalents

₹57 Cr

Operating Cash Flow

₹44 Cr

Capex

-₹28 Cr

Shareholding (proxy)

Institutional Holding

3.9%

Insider Holding

78.0%

Corporate Actions

Dividend Rate

₹2

Ex-Dividend Date

31 Jul 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹533

+25.0% vs CMP

Target Range

₹506 – ₹560

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

2 positive4 general

Sirca Paints India vs Nifty 50: 1Y Return -17.56% vs -10.93%

Univest, 12 Oct

Compare with

Equitymaster, 15 Oct

Sirca Paints India Limited (NSE:SIRCA) Looks Interesting, And It's About To Pay A Dividend

Simply Wall Street, 27 JulCapital return

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

Choice retains 'Buy' on Sirca Paints India, sees 52% upside; here's why

Business Standard, 16 Mar

Sirca Paints India Ltd Upgraded to Hold by MarketsMOJO on Technical and Valuation Improvements

MarketsMojo, 14 OctAnalyst view

🟢Potentially positiveAn analyst opinion changing, which moves the price without changing the business.

SIRCA Paints India Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 30 Aug

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health

MiddlingGrowth · Profitability · Risk

WeakValuation

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. 3 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑