Spinaroo Commercial Limited

Consumer Cyclical — Packaging & Containers · BSE

₹49.50−₹0.34 (−0.68%)

DalalBaazaar Score

34 / 100

🔴 Weak

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Spinaroo Commercial Limited manufactures and sells aluminum home foils and foil containers, paper cups, and raw materials for paper cups. The company offers bobbins, paper cups and plate blanks, laminated lids, and coated paper.

IndustryPackaging & Containers

SectorConsumer Cyclical

Employees28

Annual revenue₹39 Cr

How does it make money?

Turns over ₹39 Cr a year. Of every ₹100 of sales, about ₹1 reaches shareholders as profit, with ₹4 left at the operating level before interest, tax and depreciation. Each of its 28 employees supports ₹1.40 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin3.7%

Net margin1.4%

Revenue / employee₹1.40 Cr

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.

MARUTI SUZUKI INDIA LTD.P/E 25.2x · ROE 13.4%

TITAN COMPANY LIMITEDP/E 68.5x · ROE 36.7%

TRENT LTDP/E 87.2x · ROE 25.9%

AVENUE SUPERMARTS LIMITEDP/E 69.9x · ROE 12.7%

What is its competitive advantage?Little sign of one

Returns on capital of 7.0% 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.

ROCE7.0%

ROE4.4%

Peer median ROE25.9%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved -26% while net margin moved -22% 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-26%

Margin effect-22%

DalalBaazaar Score

34/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 9.6% a year
✗ Profit has declined at 16.8% a year
✗ Profit fell 93.6% in the latest year

Quality vs. Valuation

Company Quality

36/ 100

Weak

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

Valuation

36/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

64.3x

2Y Median

20.3x

20 monthly readings · mean 21.9x · range 13.0x–37.4x

Sector Median

69.2x

median of 4 sector peers

⚠️Current valuation is approximately 216% above its 2y median of 20.3x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟡Against its sector it is priced broadly in line with the peer median of 69.2x.

vs. its own history

Expensive

20.3x median over 20 months · +216%

vs. sector peers

Fair

69.2x median of 4 peers · -7%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

64.3x

P/B

2.06x

EV/EBITDA

28.3x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 23% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention5

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 20.1% to 3.2% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 27.5% to 7.0% — often a sign of competition or overexpansion.
Inventory building faster than sales
Inventory is up 82% against revenue growth of -26% — stock may not be moving.
Valuation above its historical average
At 64.3x the stock trades 216% above its own median of 20.3x.

Red Flags

3 items require attention · 1 high · 2 watch

🔴Inventory building faster than salesFinancial
Inventory up 82% against revenue up -26% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹7 Cr in the latest year.
🟡Profit is decliningFinancial
Net profit is down 42% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 23% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
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 debt load needs earnings to hold up
Debt is 4.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 216% 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 20.1% to 3.2%. 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 2%✓ 3.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Free cash flow remains positive✗ -₹7 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✗ 2.8x
How much operating profit can fall before interest stops being comfortably covered.
5ROCE stays above 8%✗ 7.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

4 / 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

2 good · 4 neutral · 5 weak

Market Cap

₹35 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

64.3x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.06x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.77

Profitable

Profitable on a per-share basis

ROE

4.4%

Weak

Weak capital efficiency

ROCE

7.0%

Weak

Low return on total capital employed

Debt/Equity

0.39x

Low

Conservative leverage

Revenue Growth (YoY)

8.7%

Modest

Modest growth

Profit Growth (YoY)

-93.6%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹7 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹49.5

ROA

3.0%

Average

Average asset productivity

Operating Margin

2.1%

Weak

Thin margins leave little room for error

Net Margin

1.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.19

Comfortable

Healthy short-term liquidity

52W Range Position

50%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

41.0 / 45.8

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

75.2

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹53 Cr	₹41 Cr	₹39 Cr	₹39 Cr	-9.6%
EBITDA	₹2 Cr	₹3 Cr	₹3 Cr	₹1 Cr	-14.0%
EBITDA Margin	4.3%	6.6%	7.5%	3.7%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹1 Cr	₹1 Cr	-16.8%
EPS	₹1.33	₹2	₹2.88	—	—
ROE	20.1%	23.2%	19.3%	3.2%	—
ROCE	27.5%	37.7%	32.5%	7.0%	—
Total Debt	₹8 Cr	₹8 Cr	₹8 Cr	₹7 Cr	-8.3%
Free Cash Flow	₹2 Cr	₹1 Cr	₹1 Cr	-₹7 Cr	—

🔴 Revenue has shrunk at 9.6% a year over 3 years.

🔴 EBITDA has shrunk at 14.0% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 3.7% over 3 years.

🔴 PAT (Net Profit) has shrunk at 16.8% a year over 3 years.

🔴 ROE has fallen from 20.1% to 3.2% over 3 years (-16.9 pts).

🔴 ROCE has fallen from 27.5% to 7.0% over 3 years (-20.5 pts).

🟢 Total Debt has shrunk at 8.3% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹7 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹28 Cr

Total Liabilities

₹11 Cr

Total Debt

₹7 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹6 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.5%

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 mixed1 negative3 general

SPINAROO COMMERCIAL LIMITED Share Price

Upstox, 05 May

Spinaroo Commercial Limited Withdraws Preferential Issue of 7,89,000 Equity Shares

scanx.trade, 06 AprFunding

🟡Mixed / dependsNew funding changes the capital structure. Debt raises leverage; an equity raise dilutes existing holders.

Stock Alert: J&K Bank, Larsen & Toubro, Coforge, SRF, United Breweries, Hero MotoCorp

Business Standard, 06 May

Spinaroo Commercial Limited Approves Preferential Issue and Share Swap Agreement for Strategic Acquisition

scanx.trade, 14 FebM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Multibagger Hunt 2026: 5 Penny Stocks Stealing the Spotlight

Equitymaster, 27 Mar

Spinaroo Commercial Reports FY26 Results; Net Profit Drops to Rs. 53.62 Lakhs

scanx.trade, 06 MayResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

🔴Business QualityWeak5.9/20

🟢Financial HealthStrong13.8/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak4.6/15

🔴ValuationDemanding4.9/15

🔴RiskHigh2.4/10

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 2%3.7%
✗Debt / EBITDA falls below 3x4.5x
✗Free cash flow remains positive-₹7 Cr
✗Interest cover stays above 3x2.8x
✗ROCE stays above 8%7.0%