Tainwala Chemicals and Plastics (India) Limited

Basic Materials — Specialty Chemicals · NSE

₹197.50−₹5.47 (−2.69%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

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

In simple words: The business is earning a fairly low return on the money invested in it, 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, 6:10 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

The 60-second version of Tainwala Chemicals and Plastics (India) Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Tainwala Chemicals and Plastics (India) Limited engages in the manufacture and sale of extruded plastic sheets in India. The company operates in two segments, Plastic Sheets and Tradable Items.

IndustrySpecialty Chemicals

SectorBasic Materials

Employees19

Annual revenue₹18 Cr

How does it make money?

Turns over ₹18 Cr a year. Of every ₹100 of sales, about ₹60 reaches shareholders as profit, with ₹83 left at the operating level before interest, tax and depreciation. Each of its 19 employees supports ₹93.9 lakh of revenue a year, the signature of a people-led business.

EBITDA margin82.6%

Net margin60.5%

Revenue / employee₹93.9 lakh

Who are its competitors?

The closest listed comparisons in its industry are ASIAN PAINTS LIMITED, PIDILITE INDUSTRIES LTD, SRF LTD, UPL LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

ASIAN PAINTS LIMITEDP/E 46.9x · ROE 22.3%

PIDILITE INDUSTRIES LTDP/E 57.8x · ROE 24.4%

SRF LTDP/E 33.8x · ROE 15.4%

UPL LIMITEDP/E 21.5x · ROE 6.1%

What is its competitive advantage?Little sign of one

Returns on capital of 7.1% 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.

ROCE7.1%

ROE6.3%

Peer median ROE22.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +39% while net margin moved +137% 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+39%

Margin effect+137%

DalalBaazaar Score

66/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.19 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

66/ 100

Good

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

Valuation

80/ 100

Cheap

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

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

23.1x

3Y Median

39.6x

40 monthly readings · mean 39.9x · range 17.1x–66.9x

Sector Median

40.4x

median of 4 sector peers

🟢Current valuation is approximately 42% below its 3y median of 39.6x. 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 40.4x.

vs. its own history

Cheap

39.6x median over 40 months · -42%

vs. sector peers

Cheap

40.4x median of 4 peers · -43%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

23.1x

P/B

1.07x

EV/EBITDA

12.5x

PEG

0.47

Dividend Yield

1.52%

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 47.2% to 82.6% over 3 years.
Return on capital is rising
ROCE has improved from 3.9% to 7.1%.
Valuation below its historical average
At 23.1x the stock trades 42% below its own median of 39.6x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Receivables growing faster than sales
Receivables are up 101% against revenue growth of 39% — customers are taking longer to pay.

Red Flags

3 items require attention · 2 high · 1 watch

🔴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 101% against revenue up 39% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹2 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 47.2% to 82.6%. 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 42% 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?

Sales are being booked faster than collected
Receivables are up 101% against revenue up 39%. 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
2 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 9% a year✓ 11.6% CAGR
Latest reported year was -5.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 81%✓ 82.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹2 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✗ 7.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 39.6x✓ 23.1x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

4 / 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
✓ 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 · 4 neutral · 5 weak

Market Cap

₹185 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

23.1x

Fair

Fairly valued against the generic band

P/B Ratio

1.07x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹8.55

Profitable

Profitable on a per-share basis

ROE

6.3%

Weak

Weak capital efficiency

ROCE

7.1%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

-5.7%

Shrinking

Sales are contracting

Profit Growth (YoY)

-99.0%

Falling

Profits are shrinking

Dividend Yield

1.52%

Modest

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

Free Cash Flow

-₹2 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹197.5

Operating Margin

-2.2%

Weak

Thin margins leave little room for error

Net Margin

45.0%

Good

Strong bottom-line conversion

Current Ratio

8.12

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.19

Defensive

Steadier than the market

52W Range Position

42%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

207.1 / 209.0

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

41.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹13 Cr	₹18 Cr	₹16 Cr	₹18 Cr	+11.6%
EBITDA	₹6 Cr	₹5 Cr	₹6 Cr	₹15 Cr	+34.4%
EBITDA Margin	47.2%	30.4%	39.4%	82.6%	—
PAT (Net Profit)	₹3 Cr	₹5 Cr	₹5 Cr	₹11 Cr	+48.7%
EPS	₹3.5	₹5.14	₹5.25	₹11.52	+48.8%
ROE	3.3%	4.1%	3.2%	6.3%	—
ROCE	3.9%	4.5%	3.8%	7.1%	—
Free Cash Flow	-₹7 Cr	₹12 Cr	₹9 Cr	-₹2 Cr	—

🟢 Revenue has grown at 11.6% a year over 3 years.

🟢 EBITDA has grown at 34.4% a year over 3 years.

🟢 EBITDA Margin has risen from 47.2% to 82.6% over 3 years (+35.3 pts).

🟢 PAT (Net Profit) has grown at 48.7% a year over 3 years.

🟢 EPS has grown at 48.8% a year over 3 years.

🟢 ROE has risen from 3.3% to 6.3% over 3 years (+2.9 pts).

🟢 ROCE has risen from 3.9% to 7.1% over 3 years (+3.2 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹188 Cr

Total Liabilities

₹15 Cr

Total Debt

—

Cash & Equivalents

₹1 Cr

Operating Cash Flow

-₹2 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

73.0%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

11 Aug 2026

Peer Comparison

Company	P/E	ROE
ASIAN PAINTS LIMITED	46.9x	22.3%
PIDILITE INDUSTRIES LTD	57.8x	24.4%
SRF LTD	33.8x	15.4%
UPL LIMITED	21.5x	6.1%

Recent News

2 mixed1 negative3 general

Tainwala Chemical Share Price and Stock Analysis

Kalkine India, 12 Oct

Why Investors Shouldn't Be Surprised By Tainwala Chemicals and Plastics (India) Limited's (NSE:TAINWALCHM) P/E

Simply Wall Street, 10 Feb

Tainwala Chemicals & Plastics (India) standalone net profit declines 98.93% in the June 2026 quarter

Business Standard, 05 AugResults

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

Tainwala Chemicals & Plastics (India) Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

Tainwala Chemicals & Plastics Share Price Rises 8.27% Today

Univest, 03 AugPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Rakesh Tainwala revises acquisition of 6.26% stake via gift

scanx.trade, 27 MayM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Watch Items

Revenue growth is negative (-5.7%) 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.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

🟢Business QualityStrong14.3/20

🟢Financial HealthStrong13.2/20

🟢GrowthStrong13.3/20

🟡ProfitabilityModerate8.9/15

🟢ValuationAttractive12/15

🔴RiskHigh4.4/10

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 9% a year11.6% CAGR
✓EBITDA margin holds above 81%82.6%
✗Free cash flow remains positive-₹2 Cr
✗ROCE stays above 8%7.1%
✓Valuation vs its own median of 39.6x23.1x today