TGV SRAAC Limited

Basic Materials — Chemicals · NSE

₹126.52−₹0.16 (−0.13%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Low

Driven by micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Nothing obvious stands out as stretched — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Constructive picture on fundamentals. Profitability, leverage and growth metrics are broadly healthy on this snapshot. That said, valuation should still be checked against direct sector peers (not just the generic P/E bands used here) before treating this as a buy signal.

Understanding the Business

Company site ↗

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

What does this company do?

TGV SRAAC Limited engages in the manufacture and sale of chlor-alkali chemicals, chloromethane, castor oil derivatives, and fatty acids in India and internationally. It operates through Chemicals and Oils and Fats segments.

IndustryChemicals

SectorBasic Materials

Employees1,043

Annual revenue₹1,940 Cr

How does it make money?

Turns over ₹1,940 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹19 left at the operating level before interest, tax and depreciation. Each of its 1,043 employees supports ₹1.86 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin18.8%

Net margin6.8%

Revenue / employee₹1.86 Cr

Who are its competitors?

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

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 12.5% 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.

ROCE12.5%

ROE10.2%

Peer median ROE15.4%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -16% while net margin moved -56% 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-16%

Margin effect-56%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 5.7% a year
✗ Profit has declined at 28.6% a year

Quality vs. Valuation

Company Quality

44/ 100

Weak

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

Valuation

88/ 100

Cheap

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

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

9.8x

Sector Median

33.8x

median of 3 sector peers

🟢Against its sector it trades 71% below the peer median of 33.8x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

33.8x median of 3 peers · -71%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

9.8x

P/B

1.05x

EV/EBITDA

4.7x

PEG

0.56

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.27x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention5

Margins are compressing
EBITDA margin has slipped from 23.4% to 18.8% over 3 years.
Debt is rising
Total debt is up 53% over 3 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 34.6% to 10.2% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 35.9% to 12.5% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 29% against revenue growth of -16% — customers are taking longer to pay.

Red Flags

4 items require attention · 1 high · 3 watch

🔴Debt has risen sharplyFinancial
Total debt is up 53% over 3 years, from ₹233 Cr to ₹356 Cr.
🟡Profit is decliningFinancial
Net profit is down 64% over 3 years.
🟡Margins are compressingFinancial
EBITDA margin is down 4.6 points over 3 years.
🟡Receivables growing faster than salesFinancial
Receivables up 29% against revenue up -16% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 71% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹8 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

Margins are being competed away
EBITDA margin has fallen from 23.4% to 18.8%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 29% against revenue up -16%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 34.6% to 10.2%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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 17%✓ 18.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹8 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 1.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 9%✓ 12.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

7 good · 4 neutral · 0 weak

Market Cap

₹1,355 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

9.8x

Cheap

Cheap against the generic band

P/B Ratio

1.05x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹12.96

Profitable

Profitable on a per-share basis

ROE

10.2%

Moderate

Moderate capital efficiency

ROCE

12.5%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.27x

Low

Conservative leverage

Revenue Growth (YoY)

10.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

17.5%

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

₹8 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹126.52

Operating Margin

11.8%

Average

Average margins

Net Margin

6.9%

Average

Average bottom-line conversion

Current Ratio

1.09

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

-0.32

Defensive

Steadier than the market

52W Range Position

87%

Near high

Near its 52-week high

Technical Snapshot

RSI (14)

52.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,316 Cr	₹1,535 Cr	₹1,739 Cr	₹1,940 Cr	-5.7%
EBITDA	₹542 Cr	₹151 Cr	₹237 Cr	₹364 Cr	-12.4%
EBITDA Margin	23.4%	9.8%	13.6%	18.8%	—
PAT (Net Profit)	₹362 Cr	₹61 Cr	₹92 Cr	₹132 Cr	-28.6%
EPS	₹33.77	₹5.68	₹8.6	₹12.31	-28.6%
ROE	34.6%	5.5%	7.8%	10.2%	—
ROCE	35.9%	7.8%	10.3%	12.5%	—
Total Debt	₹233 Cr	₹320 Cr	₹356 Cr	₹356 Cr	+15.2%
Free Cash Flow	₹258 Cr	-₹82 Cr	₹53 Cr	₹8 Cr	-68.8%

🔴 Revenue has shrunk at 5.7% a year over 3 years.

🔴 EBITDA has shrunk at 12.4% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.4% to 18.8% over 3 years (-4.6 pts).

🔴 PAT (Net Profit) has shrunk at 28.6% a year over 3 years.

🔴 EPS has shrunk at 28.6% a year over 3 years.

🔴 ROE has fallen from 34.6% to 10.2% over 3 years (-24.4 pts).

🔴 ROCE has fallen from 35.9% to 12.5% over 3 years (-23.5 pts).

🔴 Total Debt has grown at 15.2% a year over 3 years.

🔴 Free Cash Flow has shrunk at 68.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,124 Cr

Total Liabilities

₹827 Cr

Total Debt

₹356 Cr

Cash & Equivalents

₹13 Cr

Operating Cash Flow

₹338 Cr

Capex

-₹330 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

64.3%

Peer Comparison

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

Recent News

1 positive5 general

TGVSL Stock Price and Chart — NSE:TGVSL

TradingView, 18 Aug

TGV Sraac shareholders approve ₹1 final dividend for FY26

scanx.trade, 26 SeptCapital return

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

TGVSL Historical Data

Equitypandit, 21 Aug

TGV SRAAC Expands Solar Capacity by 2.5 MWp to Reach 62.90 MWp Total

Sahi, 13 Jul

Compare SREE.RAY.ALK with

Equitymaster, 10 Oct

TGV SRAAC Ltd (TGVSL): Chlor-Alkali Recovery and Outlook

Kalkine India, 14 Sept

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate9/20

🟢Financial HealthStrong14.6/20

🔴GrowthWeak2.4/20

🟡ProfitabilityModerate7.1/15

🟢ValuationAttractive13/15

🟡RiskModerate5.2/10

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 17%18.8%
✓Free cash flow remains positive₹8 Cr
✓Debt / EBITDA stays below 2x1.0x
✓ROCE stays above 9%12.5%