Swastika Castal Limited

Basic Materials — Aluminum · BSE

₹120.00−₹5.00 (−4.00%)

DalalBaazaar Score

65 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

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

In simple words: Strong business and financial position, 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, 6:59 pm

Understanding the Business

Company site ↗

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

What does this company do?

Swastika Castal Limited engages in manufacturing and sale of aluminum casting products. It offers components for electrical equipment and transmission; castings for transportation and heavy machinery; and air compressors and insulators for general industrial applications.

IndustryAluminum

SectorBasic Materials

Employees32

Annual revenue₹35 Cr

How does it make money?

Turns over ₹35 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 32 employees supports ₹1.09 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.09 Cr

Who are its competitors?

The closest listed comparisons in its industry are HINDALCO INDUSTRIES LTD, VEDANTA LIMITED, TATA STEEL LIMITED, JSW STEEL 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 18.5% 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 ROE18.7%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +46% while net margin moved +285% 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+46%

Margin effect+285%

DalalBaazaar Score

65/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

75/ 100

Good

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

Valuation

43/ 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

29.9x

1.4Y Median

14.5x

17 monthly readings · mean 22.2x · range 8.5x–97.2x

Sector Median

12.2x

median of 4 sector peers

⚠️Current valuation is approximately 106% above its 1.4y median of 14.5x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 145% above the peer median of 12.2x.

vs. its own history

Expensive

14.5x median over 17 months · +106%

vs. sector peers

Expensive

12.2x median of 4 peers · +145%

vs. generic bands

Fair

15x–35x

EV/EBITDA

17.7x

PEG

0.38

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 10.7% to 17.6% over 3 years.
Return on equity is rising
ROE has improved from 7.9% to 12.7%.
Return on capital is rising
ROCE has improved from 14.7% to 18.5%.
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

2 items require attention · 2 watch

🟡Free cash flow is negativeFinancial
Free cash flow was -₹13 Cr in the latest year.
🟡Receivables growing faster than salesFinancial
Receivables up 91% against revenue up 46% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 18.5% 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 10.7% to 17.6%. 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?

Sales are being booked faster than collected
Receivables are up 91% against revenue up 46%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 106% 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.
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

1Revenue growth stays above 10% a year✓ 13.4% CAGR
Latest reported year was 9.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 16%✓ 17.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹13 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 16%✓ 18.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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

4 good · 5 neutral · 2 weak

Market Cap

₹98 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

29.9x

Fair

Fairly valued against the generic band

P/B Ratio

3.79x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹4.02

Profitable

Profitable on a per-share basis

ROE

18.0%

Strong

Strong capital efficiency

ROCE

18.5%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.40x

Low

Conservative leverage

Revenue Growth (YoY)

9.6%

Modest

Modest growth

Profit Growth (YoY)

-36.3%

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

-₹12 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

8.1%

Good

Assets are working hard

Operating Margin

17.1%

Good

Healthy core-business profitability

Net Margin

9.3%

Average

Average bottom-line conversion

Current Ratio

2.00

Comfortable

Healthy short-term liquidity

52W Range Position

77%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

115.3 / 112.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

50.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹24 Cr	₹23 Cr	₹30 Cr	₹35 Cr	+13.4%
EBITDA	₹3 Cr	₹3 Cr	₹5 Cr	₹6 Cr	+34.0%
EBITDA Margin	10.7%	11.8%	17.2%	17.6%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹4 Cr	₹3 Cr	+77.7%
EPS	₹0.72	₹0.8	₹5.32	₹4.02	+77.7%
ROE	7.9%	8.1%	40.7%	12.7%	—
ROCE	14.7%	14.9%	50.5%	18.5%	—
Total Debt	₹10 Cr	₹9 Cr	₹9 Cr	₹10 Cr	+2.7%
Free Cash Flow	₹0 Cr	₹1 Cr	₹4 Cr	-₹13 Cr	—

🟢 Revenue has grown at 13.4% a year over 3 years.

🟢 EBITDA has grown at 34.0% a year over 3 years.

🟢 EBITDA Margin has risen from 10.7% to 17.6% over 3 years (+6.9 pts).

🟢 PAT (Net Profit) has grown at 77.7% a year over 3 years.

🟢 EPS has grown at 77.7% a year over 3 years.

🟢 ROE has risen from 7.9% to 12.7% over 3 years (+4.8 pts).

🟢 ROCE has risen from 14.7% to 18.5% over 3 years (+3.8 pts).

🔴 Total Debt has grown at 2.7% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹0 Cr to -₹13 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹44 Cr

Total Liabilities

₹18 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹8 Cr

Capex

-₹5 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

78.4%

Peer Comparison

Company	P/E	ROE
HINDALCO INDUSTRIES LTD	12.3x	12.0%
VEDANTA LIMITED	10.4x	18.7%
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%

Recent News

1 mixed1 negative4 general

Swastika Castal Limited Lower Circuit Today: Price, Data and Peers

Univest, 25 Sept

Swastika Castal Ltd hosts analysts, reviews operations

scanx.trade, 18 JulAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Swastika Castal net profit falls 24% in FY26 as revenue grows 17%

scanx.trade, 18 SeptResults

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

Swastika Castal Ltd IPO Review: Key Information

IndiaIPO, 21 Jul

Swastika Castal confirms no UPSI shared in Sep 8 investor meet

scanx.trade, 08 Sept

Swastika Castal Ltd, Known for High-Precision Aluminium Components, Opens IPO on 21st July 2025

Business Standard, 19 Jul

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability

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.

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