Sunshine Pictures Limited

Communication Services — Entertainment · NSE

₹454.95+₹1.75 (+0.39%)

DalalBaazaar Score

63 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Very 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, but sales are shrinking. Debt 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 Sunshine Pictures Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Sunshine Pictures Limited engages in the business of film production, content development, media distribution, and allied entertainment services in India. The company offers production of feature films, web series, and television content.

IndustryEntertainment

SectorCommunication Services

Employees30

Annual revenue₹74 Cr

How does it make money?

Turns over ₹74 Cr a year. Of every ₹100 of sales, about ₹54 reaches shareholders as profit, with ₹78 left at the operating level before interest, tax and depreciation. Each of its 30 employees supports ₹2.48 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹2.48 Cr

Who are its competitors?

The closest listed comparisons in its industry are BHARTI AIRTEL LIMITED, VODAFONE IDEA 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 37.8% 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 ROE20.2%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +181% while net margin moved +517% 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+181%

Margin effect+517%

DalalBaazaar Score

63/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 2527.5x is demanding — it needs sustained high growth to justify
✗ P/B of 8.26x is a steep premium to book

Quality vs. Valuation

Company Quality

76/ 100

Good

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

Valuation

27/ 100

Expensive

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

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

2527.5x

Sector Median

21.7x

median of 2 sector peers

⚠️Against its sector it trades 11529% above the peer median of 21.7x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Expensive

21.7x median of 2 peers · +11529%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

24.5x

PEG

15.92

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 15.8% to 78.1% over 3 years.
Return on equity is rising
ROE has improved from 8.5% to 27.6%.
Return on capital is rising
ROCE has improved from 11.9% to 37.8%.
High return on capital employed
ROCE of 37.8% is the mark of a business that converts capital into profit efficiently.
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

5 items require attention · 3 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 6.51x — 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.
🔴Inventory building faster than salesFinancial
Inventory up 357% against revenue up 181% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 42% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹34 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 37.8% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 15.8% to 78.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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 6.51x. Interest is payable whether or not the business has a good year.
A premium to the sector to defend
It trades 11529% above the peer median. That premium needs a reason that persists, or it closes.
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.
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 31% a year✓ 41.1% CAGR
Latest reported year was -28.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 76%✓ 78.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹34 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 35%✓ 37.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 10 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

Price history

Quick Metrics

4 good · 2 neutral · 5 weak

Market Cap

₹1,417 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

2527.5x

Expensive

Expensive — verify against sector peers

P/B Ratio

8.26x

Rich

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

EPS (TTM)

₹0.18

Profitable

Profitable on a per-share basis

ROE

32.3%

Strong

Strong capital efficiency

ROCE

37.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

6.51x

High

High leverage

Revenue Growth (YoY)

-28.0%

Shrinking

Sales are contracting

Profit Growth (YoY)

16.1%

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

-₹45 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

22.0%

Good

Assets are working hard

Operating Margin

6.4%

Average

Average margins

Net Margin

54.1%

Good

Strong bottom-line conversion

Current Ratio

5.18

Comfortable

Healthy short-term liquidity

52W Range Position

65%

Mid-range

Technical Snapshot

RSI (14)

60.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹27 Cr	₹134 Cr	₹103 Cr	₹74 Cr	+41.1%
EBITDA	₹4 Cr	₹70 Cr	₹49 Cr	₹58 Cr	+140.1%
EBITDA Margin	15.8%	52.1%	47.7%	78.1%	—
PAT (Net Profit)	₹2 Cr	₹53 Cr	₹34 Cr	₹40 Cr	+158.7%
EPS	₹0.74	₹17.13	₹11.06	₹12.85	+158.7%
ROE	8.5%	75.6%	32.8%	27.6%	—
ROCE	11.9%	101.3%	44.5%	37.8%	—
Total Debt	₹7 Cr	₹17 Cr	₹11 Cr	₹9 Cr	+12.3%
Free Cash Flow	-₹10 Cr	₹20 Cr	₹23 Cr	-₹34 Cr	—

🟢 Revenue has grown at 41.1% a year over 3 years.

🟢 EBITDA has grown at 140.1% a year over 3 years.

🟢 EBITDA Margin has risen from 15.8% to 78.1% over 3 years (+62.3 pts).

🟢 PAT (Net Profit) has grown at 158.7% a year over 3 years.

🟢 EPS has grown at 158.7% a year over 3 years.

🟢 ROE has risen from 8.5% to 27.6% over 3 years (+19.1 pts).

🟢 ROCE has risen from 11.9% to 37.8% over 3 years (+26.0 pts).

🔴 Total Debt has grown at 12.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹180 Cr

Total Liabilities

₹35 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹33 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

84.6%

Peer Comparison

Company	P/E	ROE
BHARTI AIRTEL LIMITED	39.8x	20.2%
VODAFONE IDEA LIMITED	3.6x	—

Recent News

6 general

Sunshine Pictures IPO Listing: Shares List at 9.97% Premium on NSE, Fall Short of Grey-Market Hopes

India Infoline, 25 Aug

Sunshine Pictures shares list at 10% premium over IPO price

The Economic Times, 25 Aug

Sunshine Pictures IPO Day 3: Subscription Status, Timeline & Key Issue Details

Groww, 19 Aug

SUNSHINE PICTURES LIMITED Share Price - Live NSE: SUNSHINE Stock Price & Chart

Upstox, 25 Aug

Sunshine Pictures IPO listing date today. GMP, experts hint up to 14% listing pop

Livemint, 25 Aug

Sunshine Pictures shares make decent market debut at 10% premium; should you buy, sell or hold?

Moneycontrol.com, 25 Aug

Watch Items

Revenue growth is negative (-28.0%) 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

StrongBusiness Quality · Growth · Profitability

MiddlingFinancial Health

WeakValuation · Risk

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given 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 ↑