Suditi Industries Limited

Consumer Cyclical — Textile Manufacturing · BSE

₹61.90+₹3.82 (+6.58%)

DalalBaazaar Score

54 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

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

In simple words: Reasonable but unspectacular business quality, but sales are shrinking. Cash generation is currently 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 Suditi Industries Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Suditi Industries Limited processes, manufactures, and sells knitted hosiery fabrics and readymade garments in India. The company also engages in retailing business.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees199

Annual revenue₹121 Cr

How does it make money?

Turns over ₹121 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 199 employees supports ₹61.0 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹61.0 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?Little sign of one

Returns on capital of 14.5% 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.

Peer median ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +18% while net margin moved -151% 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+18%

Margin effect-151%

DalalBaazaar Score

54/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 5.7% — barely ahead of inflation
✗ Latest-year revenue growth of -39.3% is below the longer-term trend — momentum is fading
✗ Profit fell 37.5% in the latest year

Quality vs. Valuation

Company Quality

57/ 100

Average

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

Valuation

68/ 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

34.2x

1.3Y Median

56.4x

16 monthly readings · mean 56.1x · range 30.9x–87.0x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 39% below its 1.3y median of 56.4x. 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 51% below the peer median of 69.2x.

vs. its own history

Cheap

56.4x median over 16 months · -39%

vs. sector peers

Cheap

69.2x median of 4 peers · -51%

vs. generic bands

Fair

15x–35x

EV/EBITDA

22.1x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from -20.7% to 12.5% over 3 years.
Very low debt
Debt/Equity of 0.11x leaves the balance sheet with plenty of headroom.

🔴 What Needs Attention0

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

Red Flags

4 items require attention · 1 high · 3 watch

🔴Receivables growing faster than salesFinancial
Receivables up 128% against revenue up 18% — sales are being booked faster than they are collected.
🟡Debt is increasingFinancial
Total debt is up 25% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹15 Cr in the latest year.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 88% 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 -20.7% to 12.5%. 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 39% 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 51% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 128% against revenue up 18%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Growth barely outpaces inflation
Revenue compounding at 5.7% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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

1EBITDA margin holds above 10%✓ 12.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹15 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 4% a year✓ 5.7% CAGR
Latest reported year was -39.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 0.8x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 11%✓ 14.5%
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 · 5 neutral · 4 weak

Market Cap

₹337 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

34.2x

Fair

Fairly valued against the generic band

P/B Ratio

6.56x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹1.81

Profitable

Profitable on a per-share basis

ROE

13.9%

Moderate

Moderate capital efficiency

ROCE

14.5%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.11x

Low

Conservative leverage

Revenue Growth (YoY)

-39.3%

Shrinking

Sales are contracting

Profit Growth (YoY)

-37.5%

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

-₹15 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

9.7%

Average

Average margins

Net Margin

9.1%

Average

Average bottom-line conversion

Current Ratio

2.21

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.09

Defensive

Steadier than the market

52W Range Position

18%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

63.4 / 68.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

27.3

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹103 Cr	₹68 Cr	₹95 Cr	₹121 Cr	+5.7%
EBITDA	-₹21 Cr	-₹4 Cr	₹6 Cr	₹15 Cr	—
EBITDA Margin	-20.7%	-5.8%	6.2%	12.5%	—
PAT (Net Profit)	-₹18 Cr	-₹12 Cr	₹3 Cr	₹11 Cr	—
EPS	₹-6.66	₹-4.43	₹1.17	₹2	—
ROE	—	—	12.1%	13.9%	—
ROCE	—	—	7.9%	14.5%	—
Total Debt	₹10 Cr	₹12 Cr	₹13 Cr	₹12 Cr	+7.8%
Free Cash Flow	-₹3 Cr	₹1 Cr	-₹24 Cr	-₹15 Cr	—

🟢 Revenue has grown at 5.7% a year over 3 years.

🟢 EBITDA has turned positive, from -₹21 Cr to ₹15 Cr.

🟢 EBITDA Margin has risen from -20.7% to 12.5% over 3 years (+33.2 pts).

🟢 PAT (Net Profit) has turned positive, from -₹18 Cr to ₹11 Cr.

🟢 EPS has turned positive, from ₹-6.66 to ₹2.

🟢 ROE has risen from 12.1% to 13.9% over 3 years (+1.8 pts).

🟢 ROCE has risen from 7.9% to 14.5% over 3 years (+6.6 pts).

🔴 Total Debt has grown at 7.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹119 Cr

Total Liabilities

₹43 Cr

Cash & Equivalents

₹15 Cr

Operating Cash Flow

-₹15 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

73.6%

Corporate Actions

Ex-Dividend Date

20 Sept 2019

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

1 mixed5 general

SUDITI INDUSTRIES LTD. Share Price

Upstox, 16 Oct

Suditi Industries posts 235% PAT jump to ₹1,053 lakh in FY26

scanx.trade, 30 Sept

Compare with SUDITI INDUSTRIES

Equitymaster, 21 Sept

Suditi Industries Share Price Falls 9.61%: Key Analysis

Univest, 02 SeptPrice 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.

Suditi Industries promoters convert 4.5m warrants to equity shares

scanx.trade, 12 Aug

Suditi Industries Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 30 Aug

Watch Items

Revenue growth is negative (-39.3%) 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.
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

StrongFinancial Health

MiddlingBusiness Quality · Profitability · Valuation

WeakGrowth · Risk

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. 1 high-severity red flag sits above this conclusion and should be read first.

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