SMT Engineering Limited

Financial Services — Capital Markets · BSE

₹295.60+₹0.70 (+0.24%)

DalalBaazaar Score

72 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, 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, 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 SMT Engineering Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

SMT Engineering Limited engages in the trading of goods and shares in India. The company is involved in investment in mutual funds, shares, and securities. The company was formerly known as Adarsh Mercantile Limited and changed its name to SMT Engineering Limited in June 2025.

IndustryCapital Markets

SectorFinancial Services

Employees3

Annual revenue₹162 Cr

How does it make money?

Turns over ₹162 Cr a year. Of every ₹100 of sales, about ₹14 reaches shareholders as profit, with ₹25 left at the operating level before interest, tax and depreciation. Each of its 3 employees supports ₹54.08 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin24.9%

Net margin14.2%

Revenue / employee₹54.08 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.

BAJAJ FINANCE LIMITEDP/E 30.2x · ROE 17.8%

HDFC LIFE INS CO LTDP/E 58.4x · ROE 11.3%

SBI LIFE INSURANCE CO LTDP/E 63.9x · ROE 13.7%

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.

ROCE24.4%

ROE19.1%

Peer median ROE13.7%

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 +61569% while net margin moved -114% 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+61569%

Margin effect-114%

DalalBaazaar Score

72/ 100

Good

Weighted across six categories. Every point is explained below.

• Beta of 0.82 — moves roughly with the market
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

77/ 100

Good

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

Valuation

73/ 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

20.3x

1.3Y Median

30.8x

16 monthly readings · mean 38.3x · range 6.4x–74.0x

Sector Median

58.4x

median of 3 sector peers

🟢Current valuation is approximately 34% below its 1.3y median of 30.8x. 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 65% below the peer median of 58.4x.

vs. its own history

Cheap

30.8x median over 16 months · -34%

vs. sector peers

Cheap

58.4x median of 3 peers · -65%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

20.3x

P/B

4.10x

EV/EBITDA

15.2x

PEG

0.42

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from -2.2% to 24.9% over 3 years.
Return on equity is rising
ROE has improved from -3.8% to 19.1%.
Return on capital is rising
ROCE has improved from 0.2% to 24.4%.
Valuation below its historical average
At 20.3x the stock trades 34% below its own median of 30.8x.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 watch

🟡Shareholders have been dilutedOwnership
Shares outstanding are up 392% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -2.2% to 24.9%. 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 34% 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 65% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 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
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 563% a year✓ 751.2% CAGR
Latest reported year was 14.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 23%✓ 24.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 17%✓ 19.1%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Valuation vs its own median of 30.8x✓ 20.3x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

9 / 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 · 5 neutral · 1 weak

Market Cap

₹534 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

20.3x

Fair

Fairly valued against the generic band

P/B Ratio

4.10x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹14.57

Profitable

Profitable on a per-share basis

ROE

19.1%

Strong

Strong capital efficiency

ROCE

24.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.68x

Moderate

Moderate leverage

Revenue Growth (YoY)

14.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

48.6%

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

-₹55 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹295.6

Operating Margin

21.1%

Good

Healthy core-business profitability

Net Margin

14.7%

Good

Strong bottom-line conversion

Current Ratio

1.80

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.82

Market-like

Moves roughly in line with the market

52W Range Position

42%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

321.0 / 361.8

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

26.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹0 Cr	₹3 Cr	₹21 Cr	₹162 Cr	+751.2%
EBITDA	-₹0 Cr	-₹2 Cr	₹4 Cr	₹40 Cr	—
EBITDA Margin	-2.2%	-62.3%	16.7%	24.9%	—
PAT (Net Profit)	-₹0 Cr	-₹2 Cr	₹2 Cr	₹23 Cr	—
EPS	₹-0.75	₹-4.57	₹6.35	₹13.8	—
ROE	-3.8%	-22.2%	3.9%	19.1%	—
ROCE	0.2%	-21.4%	3.5%	24.4%	—
Total Debt	₹4 Cr	—	₹52 Cr	₹82 Cr	+182.2%
Free Cash Flow	-₹0 Cr	-₹8 Cr	-₹10 Cr	-₹55 Cr	—

🟢 Revenue has grown at 751.2% a year over 3 years.

🟢 EBITDA has turned positive, from -₹0 Cr to ₹40 Cr.

🟢 EBITDA Margin has risen from -2.2% to 24.9% over 3 years (+27.1 pts).

🟢 PAT (Net Profit) has turned positive, from -₹0 Cr to ₹23 Cr.

🟢 EPS has turned positive, from ₹-0.75 to ₹13.8.

🟢 ROE has risen from -3.8% to 19.1% over 3 years (+23.0 pts).

🟢 ROCE has risen from 0.2% to 24.4% over 3 years (+24.2 pts).

🔴 Total Debt has grown at 182.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹267 Cr

Total Liabilities

₹146 Cr

Total Debt

₹82 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

-₹29 Cr

Capex

-₹26 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

90.1%

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

1 mixed1 negative4 general

SMT Engineering shareholders pass all 11 resolutions at FY26 AGM

scanx.trade, 01 Oct

Sahajanand Medical IPO GMP Today with Listing Gain Expectation

IPO Watch, 18 Oct

MMTC Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

SMT Engineering pays ₹1.13 lakh fine to BSE for compliance delay

scanx.trade, 18 JulRegulatory

🔴Potentially negativeRegulatory and legal actions carry a financial cost and a governance question. The second usually matters more than the first.

ONEGLOBAL Stock Price and Chart — NSE:ONEGLOBAL

TradingView, 17 Aug

Q1 results 2026: Tata Motors PV to Brainbees Solutions among companies to declare Q1 results today; full list here

Livemint, 13 AugResults

🟡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

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.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

🟢Business QualityStrong15.9/20

🟢Financial HealthStrong17/20

🟢GrowthStrong13/20

🟢ProfitabilityStrong12/15

🟢ValuationAttractive10.7/15

🔴RiskHigh3.5/10

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

✓Revenue growth stays above 563% a year751.2% CAGR
✓EBITDA margin holds above 23%24.9%
✓Return on equity stays above 17%19.1%
✓Valuation vs its own median of 30.8x20.3x today