SRM Energy Limited

Utilities — Utilities - Regulated Electric · BSE

₹33.06+₹1.57 (+4.99%)

DalalBaazaar Score

24 / 100

🔴 Weak

Verdict

HIGH RISK

Risk

Very High

Driven by negative shareholders' equity — the company owes more than it owns, short-term liabilities exceed short-term assets, micro-cap size, which brings thin liquidity.

In simple words: The company owes more than it owns — years of losses have wiped out its net worth. Solvency — whether it can keep funding itself at all — 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 SRM Energy Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

SRM Energy Limited does not have significant operations. Previously, the company was engaged in generation of power in India. The company was formerly known as Hitkari Fibres Limited and changed its name to SRM Energy Limited in January 2009.

IndustryUtilities - Regulated Electric

SectorUtilities

Employees2

Who are its competitors?

The closest listed comparisons in its industry are NTPC LTD, POWER GRID CORP. LTD., TATA POWER CO LTD, ADANI POWER LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

DalalBaazaar Score

24/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Shareholders' equity is negative — accumulated losses exceed the capital in the business

Quality vs. Valuation

Company Quality

25/ 100

Weak

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

Valuation

30/ 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

7.7x

Sector Median

20.6x

median of 4 sector peers

🟢Against its sector it trades 63% below the peer median of 20.6x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

20.6x median of 4 peers · -63%

vs. generic bands

N/A

Multiples unreliable — equity base is negative

EV/EBITDA

18.6x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 92% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.

🔴 What Needs Attention0

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

Red Flags

2 items require attention · 1 high · 1 watch

🔴Negative shareholders' equityFinancial
Liabilities exceed assets — accumulated losses have wiped out the company's net worth.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.00 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 92% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 63% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

Solvency comes before everything else
Liabilities exceed assets. Until net worth is rebuilt, the equity is a claim on a business that owes more than it owns, and further losses or a funding squeeze can leave shareholders with nothing.
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

1Free cash flow remains positive✓ ₹2 Cr
Profit that never becomes cash eventually stops being profit.
2Debt / EBITDA stays below 2x✓ 2.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.

Investment Checklist

5 / 8 checks passed

✗ Shareholders' equity is positive (assets exceed liabilities)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ 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

4 good · 5 neutral · 2 weak

Market Cap

₹30 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

7.7x

Cheap

Cheap against the generic band

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

₹4.32

Profitable

Profitable on a per-share basis

ROE

Not meaningful

Negative equity

Return on equity can't be read when equity itself is negative

ROCE

Not available

No data

Source didn't return this field

Debt/Equity

Not meaningful

Negative equity

Shareholders' equity is negative, so this ratio can't be read

Revenue Growth (YoY)

Not available

No data

Source didn't return this field

Profit Growth (YoY)

241.4%

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

₹2 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

98.1%

Good

Healthy core-business profitability

Net Margin

69.1%

Good

Strong bottom-line conversion

Current Ratio

0.00

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.35

Defensive

Steadier than the market

52W Range Position

98%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

28.7 / 26.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

70.1

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
EBITDA	-₹1 Cr	-₹1 Cr	-₹0 Cr	₹2 Cr	—
PAT (Net Profit)	-₹2 Cr	-₹1 Cr	-₹0 Cr	₹1 Cr	—
EPS	₹-2.51	₹-0.87	₹-0.41	₹0.35	—
Total Debt	₹46 Cr	₹46 Cr	₹5 Cr	₹4 Cr	-57.5%
Free Cash Flow	-₹1 Cr	-₹1 Cr	-₹0 Cr	₹2 Cr	—

🟢 EBITDA has turned positive, from -₹1 Cr to ₹2 Cr.

🟢 PAT (Net Profit) has turned positive, from -₹2 Cr to ₹1 Cr.

🟢 EPS has turned positive, from ₹-2.51 to ₹0.35.

🟢 Total Debt has shrunk at 57.5% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹1 Cr to ₹2 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹0 Cr

Total Liabilities

₹4 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹2 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

71.2%

Peer Comparison

Company	P/E	ROE
NTPC LTD	11.0x	13.7%
POWER GRID CORP. LTD.	14.6x	15.8%
TATA POWER CO LTD	29.3x	9.8%
ADANI POWER LTD	26.5x	21.9%

Recent News

1 mixed5 general

SRM Energy Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

SRM Energy closes trading window for Q1FY27 results

scanx.trade, 23 JunResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

VEDANTA POWER LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 16 Oct

SRM Energy Ltd is Rated Hold

MarketsMojo, 08 Oct

SRM Energy Ltd. Peer Comparison – Compare with Others

Value Research, 27 Aug

SRM Energy Open Offer Concludes with Minimal Shareholder Response

scanx.trade, 14 Mar

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

MiddlingGrowth

WeakBusiness Quality · Financial Health · Profitability · Valuation · Risk

Points for each in the Score ↑

Avoid until solvency is resolved

SRM Energy Limited owes more than it owns. Whatever the operating numbers show, the equity is a residual claim on a business with negative net worth, and that question has to be settled before any of the rest is worth weighing. 1 high-severity red flag sits above this conclusion and should be read first.

All 2 tripwires holding · see Key things to watch ↑