S.P. Apparels Limited

Consumer Cyclical — Apparel Manufacturing · NSE

₹924.05−₹4.95 (−0.53%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, but sales are shrinking. Whether sales start growing again is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

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

What does this company do?

S.P. Apparels Limited, together with its subsidiaries, manufactures and exports knitted garments for infant wear, children's apparel, and intimate wear in India and internationally. The company offers yarns, fabrics, and cotton waste products under the Angel & Rocket brand.

IndustryApparel Manufacturing

SectorConsumer Cyclical

Employees13,534

Annual revenue₹1,496 Cr

How does it make money?

Turns over ₹1,496 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹15 left at the operating level before interest, tax and depreciation. Each of its 13,534 employees supports ₹11.1 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹11.1 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?Some evidence

ROCE of 15.9% 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 ROE25.9%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 11.5% and earnings to grow about 16.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+11.5%

Est. earnings growth+16.5%

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 +46% while net margin moved -16% 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+46%

Margin effect-16%

DalalBaazaar Score

59/ 100

Moderate

Weighted across six categories. Every point is explained below.

• Revenue CAGR of 13.3% is steady
✗ Profit CAGR of only 7.0%
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Latest-year revenue growth of -0.6% is below the longer-term trend — momentum is fading

Quality vs. Valuation

Company Quality

58/ 100

Average

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

Valuation

60/ 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

22.1x

3Y Median

20.6x

40 monthly readings · mean 21.4x · range 15.6x–30.0x

Sector Median

69.2x

median of 4 sector peers

🟡Currently trading close to its 3y median of 20.6x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 68% below the peer median of 69.2x.

vs. its own history

Fair

20.6x median over 40 months · +7%

vs. sector peers

Cheap

69.2x median of 4 peers · -68%

vs. generic bands

Fair

15x–35x

EV/EBITDA

12.4x

PEG

3.18

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Margins are compressing
EBITDA margin has slipped from 16.4% to 14.5% over 3 years.

Red Flags

2 items require attention · 2 high

🔴Debt has risen sharplyFinancial
Total debt is up 71% over 3 years, from ₹245 Cr to ₹419 Cr.
🔴Receivables growing faster than salesFinancial
Receivables up 142% against revenue up 46% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 68% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹101 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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 16.4% to 14.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 142% against revenue up 46%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
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

1Revenue growth stays above 10% a year✓ 13.3% CAGR
Latest reported year was -0.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 13%✓ 14.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹101 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.9x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 13%✓ 15.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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 · 5 neutral · 1 weak

Market Cap

₹2,323 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

2.45x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹41.81

Profitable

Profitable on a per-share basis

ROE

10.7%

Moderate

Moderate capital efficiency

ROCE

15.9%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.45x

Low

Conservative leverage

Revenue Growth (YoY)

-0.6%

Shrinking

Sales are contracting

Profit Growth (YoY)

19.8%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.32%

Modest

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

Free Cash Flow

₹101 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

14.7x

Improving

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

Operating Margin

12.0%

Average

Average margins

Net Margin

6.7%

Average

Average bottom-line conversion

Current Ratio

1.32

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.15

Defensive

Steadier than the market

52W Range Position

52%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

950.8 / 979.4

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

40.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,027 Cr	₹1,031 Cr	₹1,321 Cr	₹1,496 Cr	+13.3%
EBITDA	₹169 Cr	₹156 Cr	₹190 Cr	₹217 Cr	+8.7%
EBITDA Margin	16.4%	15.1%	14.4%	14.5%	—
PAT (Net Profit)	₹83 Cr	₹90 Cr	₹95 Cr	₹101 Cr	+7.0%
EPS	₹32.37	₹35.72	₹37.9	₹40.09	+7.4%
ROE	12.2%	11.7%	11.1%	10.7%	—
ROCE	16.5%	15.9%	15.3%	15.9%	—
Total Debt	₹245 Cr	₹203 Cr	₹381 Cr	₹419 Cr	+19.6%
Free Cash Flow	₹164 Cr	₹24 Cr	-₹38 Cr	₹101 Cr	-14.9%

🟢 Revenue has grown at 13.3% a year over 3 years.

🟢 EBITDA has grown at 8.7% a year over 3 years.

🔴 EBITDA Margin has fallen from 16.4% to 14.5% over 3 years (-1.9 pts).

🟢 PAT (Net Profit) has grown at 7.0% a year over 3 years.

🟢 EPS has grown at 7.4% a year over 3 years.

🔴 ROE has fallen from 12.2% to 10.7% over 3 years (-1.6 pts).

🟡 ROCE has held roughly flat at 15.9% over 3 years.

🔴 Total Debt has grown at 19.6% a year over 3 years.

🔴 Free Cash Flow has shrunk at 14.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,591 Cr

Total Liabilities

₹651 Cr

Cash & Equivalents

₹54 Cr

Operating Cash Flow

₹209 Cr

Capex

-₹108 Cr

Shareholding (proxy)

Institutional Holding

15.2%

Insider Holding

61.2%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

04 Sept 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,151

+24.6% vs CMP

Target Range

₹1,000 – ₹1,302

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

2 positive1 mixed3 general

Textile stocks Arvind, S P Apparels surge up to 13%; log 52-week highs

Business Standard, 30 Jun

S.P. Apparels Ltd. Share Price Falls 9.4%: Full Analysis

Univest, 12 AugPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

S P Apparels sets Dec 10 record date for equity share split

scanx.trade, 06 Oct

S.P. Apparels (NSE:SPAL) Could Be A Buy For Its Upcoming Dividend

Simply Wall Street, 31 AugCapital return

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

This Smallcap Apparel Maker Approves 1:5 Stock Split, Declares Dividend

NDTV Profit, 11 AugCapital return

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

Compare with

Equitymaster, 08 Oct

Watch Items

Revenue growth is negative (-0.6%) 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

MiddlingBusiness Quality · Profitability · Valuation · Risk

WeakGrowth

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.

All 5 tripwires holding · see Key things to watch ↑