Subros Limited

Consumer Cyclical — Auto Parts · NSE

₹660.00−₹10.25 (−1.53%)

DalalBaazaar Score

60 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

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

In simple words: Strong business and financial position, with modest growth. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Subros Limited engages in the manufacture and sale of thermal products for automotive applications in India and internationally.

IndustryAuto Parts

SectorConsumer Cyclical

Employees4,394

Annual revenue₹3,742 Cr

How does it make money?

Turns over ₹3,742 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹9 left at the operating level before interest, tax and depreciation. Each of its 4,394 employees supports ₹85.2 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹85.2 lakh

Who are its competitors?

The closest listed comparisons in its industry are BOSCH LIMITED, MARUTI SUZUKI INDIA LTD., TVS MOTOR COMPANY LTD, EICHER MOTORS LTD. 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 16.7% 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 ROE23.0%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 14.2% and earnings to grow about 35.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.2%

Est. earnings growth+35.8%

Analysts3

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +34% while net margin moved +159% 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+34%

Margin effect+159%

DalalBaazaar Score

60/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.57 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

62/ 100

Average

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

Valuation

77/ 100

Cheap

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

25.9x

3Y Median

43.3x

40 monthly readings · mean 49.8x · range 26.0x–95.3x

Sector Median

45.7x

median of 4 sector peers

🟢Current valuation is approximately 40% below its 3y median of 43.3x. 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 43% below the peer median of 45.7x.

vs. its own history

Cheap

43.3x median over 40 months · -40%

vs. sector peers

Cheap

45.7x median of 4 peers · -43%

vs. generic bands

Fair

15x–35x

EV/EBITDA

12.4x

PEG

0.51

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 6.5% to 9.4% over 3 years.
Return on equity is rising
ROE has improved from 5.5% to 13.3%.
Return on capital is rising
ROCE has improved from 8.1% to 16.7%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

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

Red Flags

4 items require attention · 3 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 6.01x — 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 135% against revenue up 34% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹44 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 6.5% to 9.4%. 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 40% 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 43% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
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?

Leverage amplifies any setback
Debt/Equity of 6.01x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 135% against revenue up 34%. 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
3 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 8% a year✓ 10.2% CAGR
Latest reported year was 17.5%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 7%✓ 9.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹44 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 14%✓ 16.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

3 good · 6 neutral · 2 weak

Market Cap

₹4,306 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

25.9x

Fair

Fairly valued against the generic band

P/B Ratio

3.46x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹25.49

Profitable

Profitable on a per-share basis

ROE

13.3%

Moderate

Moderate capital efficiency

ROCE

16.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

6.01x

High

High leverage

Revenue Growth (YoY)

17.5%

Healthy

Healthy top-line growth

Profit Growth (YoY)

1.6%

Modest

Slow profit growth

Dividend Yield

0.45%

Modest

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

Free Cash Flow

-₹44 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

18.0x

Improving

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

Operating Margin

5.0%

Average

Average margins

Net Margin

4.3%

Average

Average bottom-line conversion

Current Ratio

1.61

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.57

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

692.8 / 717.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

25.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,800 Cr	₹3,071 Cr	₹3,357 Cr	₹3,742 Cr	+10.2%
EBITDA	₹181 Cr	₹267 Cr	₹335 Cr	₹353 Cr	+24.9%
EBITDA Margin	6.5%	8.7%	10.0%	9.4%	—
PAT (Net Profit)	₹48 Cr	₹98 Cr	₹151 Cr	₹166 Cr	+51.2%
EPS	₹7.35	₹14.96	₹23.07	₹25.39	+51.2%
ROE	5.5%	10.2%	13.8%	13.3%	—
ROCE	8.1%	14.6%	18.3%	16.7%	—
Total Debt	₹81 Cr	₹35 Cr	₹41 Cr	₹75 Cr	-2.8%
Free Cash Flow	₹8 Cr	₹46 Cr	₹57 Cr	-₹44 Cr	—

🟢 Revenue has grown at 10.2% a year over 3 years.

🟢 EBITDA has grown at 24.9% a year over 3 years.

🟢 EBITDA Margin has risen from 6.5% to 9.4% over 3 years (+3.0 pts).

🟢 PAT (Net Profit) has grown at 51.2% a year over 3 years.

🟢 EPS has grown at 51.2% a year over 3 years.

🟢 ROE has risen from 5.5% to 13.3% over 3 years (+7.8 pts).

🟢 ROCE has risen from 8.1% to 16.7% over 3 years (+8.5 pts).

🟢 Total Debt has shrunk at 2.8% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹8 Cr to -₹44 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,134 Cr

Total Liabilities

₹890 Cr

Cash & Equivalents

₹12 Cr

Operating Cash Flow

₹105 Cr

Capex

-₹150 Cr

Shareholding (proxy)

Institutional Holding

11.4%

Insider Holding

74.6%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

11 Sept 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹895.5

+35.7% vs CMP

Target Range

₹850 – ₹941

Peer Comparison

Company	P/E	ROE
BOSCH LIMITED	56.9x	15.9%
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TVS MOTOR COMPANY LTD	56.8x	35.8%
EICHER MOTORS LTD	34.7x	23.0%

Recent News

2 positive4 general

Subros vs Nifty 50: 1Y Return -39.65% vs -10.93%

Univest, 12 Oct

Subros Limited (NSE:SUBROS) Not Flying Under The Radar

Simply Wall Street, 13 Jan

Volume buzzers: NOCIL, Subros, EMS, Kirloskar Ind, EPACK zoom up to 20%

Business Standard, 22 Jun

Subros Q4 Results | Net profit up 7% as revenue climbs 16%; declares ₹3 dividend

CNBC TV18, 18 MayCapital return

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

Subros Share: Bull Case vs Bear Case for 2026

Univest, 25 Sept

Subros FY26 Revenue Hits Record High; Dividend ₹3

scanx.trade, 18 MayCapital return

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

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
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

StrongGrowth

MiddlingBusiness Quality · Financial Health · Profitability · Valuation

WeakRisk

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.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑