Vadilal Industries Limited

Consumer Defensive — Packaged Foods · NSE

₹7,125.00−₹3.00 (−0.04%)

DalalBaazaar Score

70 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Vadilal Industries Limited, together with its subsidiaries, manufactures and sells ice-cream in India and internationally.

IndustryPackaged Foods

SectorConsumer Defensive

Employees704

Annual revenue₹1,497 Cr

How does it make money?

Turns over ₹1,497 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 704 employees supports ₹2.13 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin17.8%

Net margin10.4%

Revenue / employee₹2.13 Cr

Who are its competitors?

The closest listed comparisons in its industry are NESTLE INDIA LIMITED, BRITANNIA INDUSTRIES LTD, TATA CONSUMER PRODUCT LTD, DABUR INDIA LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

NESTLE INDIA LIMITEDP/E 59.8x · ROE 79.9%

BRITANNIA INDUSTRIES LTDP/E 44.1x · ROE 51.0%

TATA CONSUMER PRODUCT LTDP/E 59.3x · ROE 7.5%

DABUR INDIA LTDP/E 34.7x · ROE 17.2%

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 20.8%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 18.2% against a peer median of 51.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

ROCE20.8%

ROE18.2%

Peer median ROE51.0%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +42% while net margin moved +13% 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+42%

Margin effect+13%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 23.4x is within a normal band
• P/E is close to its own historical median of 24.3x
✗ P/B of 6.02x is a steep premium to book

Quality vs. Valuation

Company Quality

74/ 100

Good

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

Valuation

61/ 100

Fair

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

23.4x

3Y Median

24.3x

40 monthly readings · mean 25.2x · range 17.7x–35.6x

Sector Median

51.7x

median of 4 sector peers

🟡Currently trading close to its 3y median of 24.3x — the market is paying about what it usually pays for this company.

🟢Against its sector it trades 55% below the peer median of 51.7x.

vs. its own history

Fair

24.3x median over 40 months · -4%

vs. sector peers

Cheap

51.7x median of 4 peers · -55%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

23.4x

P/B

6.02x

EV/EBITDA

20.0x

PEG

1.36

Dividend Yield

0.60%

What's Good / What's Bad

🟢 What's Going Well5

Debt is being paid down
Total debt is down 21% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
High return on capital employed
ROCE of 20.8% is the mark of a business that converts capital into profit efficiently.
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 Attention3

Return on equity is falling
ROE has dropped from 24.2% to 18.2% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 25.8% to 20.8% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 129% against revenue growth of 42% — customers are taking longer to pay.

Red Flags

1 item require attention · 1 high

🔴Receivables growing faster than salesFinancial
Receivables up 129% against revenue up 42% — 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 20.8% 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.
Deleveraging frees up earnings
Debt is down 21% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 55% 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 ₹47 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?

Sales are being booked faster than collected
Receivables are up 129% against revenue up 42%. 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 24.2% to 18.2%. 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
Small 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 9% a year✓ 12.4% CAGR
Latest reported year was 34.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 16%✓ 17.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹47 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.9x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 18%✓ 20.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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

7 good · 3 neutral · 1 weak

Market Cap

₹5,121 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

23.4x

Fair

Fairly valued against the generic band

P/B Ratio

6.02x

Rich

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

EPS (TTM)

₹304.84

Profitable

Profitable on a per-share basis

ROE

18.2%

Strong

Strong capital efficiency

ROCE

20.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.27x

Low

Conservative leverage

Revenue Growth (YoY)

34.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

95.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.60%

Modest

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

Free Cash Flow

₹47 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹7,125

Operating Margin

22.2%

Good

Healthy core-business profitability

Net Margin

13.1%

Good

Strong bottom-line conversion

Current Ratio

3.00

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.05

Defensive

Steadier than the market

52W Range Position

70%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

7293.1 / 7377.5

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

32.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,055 Cr	₹1,123 Cr	₹1,235 Cr	₹1,497 Cr	+12.4%
EBITDA	₹178 Cr	₹229 Cr	₹252 Cr	₹266 Cr	+14.4%
EBITDA Margin	16.9%	20.4%	20.4%	17.8%	—
PAT (Net Profit)	₹96 Cr	₹146 Cr	₹150 Cr	₹155 Cr	+17.2%
EPS	₹133.97	₹203.06	₹209.15	₹215.78	+17.2%
ROE	24.2%	26.9%	21.6%	18.2%	—
ROCE	25.8%	27.8%	23.9%	20.8%	—
Total Debt	₹290 Cr	₹223 Cr	₹218 Cr	₹230 Cr	-7.5%
Free Cash Flow	-₹19 Cr	₹132 Cr	₹31 Cr	₹47 Cr	—

🟢 Revenue has grown at 12.4% a year over 3 years.

🟢 EBITDA has grown at 14.4% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 17.8% over 3 years.

🟢 PAT (Net Profit) has grown at 17.2% a year over 3 years.

🟢 EPS has grown at 17.2% a year over 3 years.

🔴 ROE has fallen from 24.2% to 18.2% over 3 years (-6.0 pts).

🔴 ROCE has fallen from 25.8% to 20.8% over 3 years (-5.1 pts).

🟢 Total Debt has shrunk at 7.5% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹19 Cr to ₹47 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,273 Cr

Total Liabilities

₹423 Cr

Total Debt

₹230 Cr

Cash & Equivalents

₹37 Cr

Operating Cash Flow

₹143 Cr

Capex

-₹97 Cr

Shareholding (proxy)

Institutional Holding

1.5%

Insider Holding

68.1%

Corporate Actions

Dividend Rate

₹43

Ex-Dividend Date

03 Sept 2026

Peer Comparison

Company	P/E	ROE
NESTLE INDIA LIMITED	59.8x	79.9%
BRITANNIA INDUSTRIES LTD	44.1x	51.0%
TATA CONSUMER PRODUCT LTD	59.3x	7.5%
DABUR INDIA LTD	34.7x	17.2%

Recent News

3 positive1 mixed2 general

Vadilal Industries vs Nifty 50: 1Y Return +38.20% vs -11.35%

Univest, 13 Oct

Vadilal Industries shares hit record high on strong Q1 earnings; check dividend details for FY27

Upstox, 13 AugCapital return

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

Vadilal Industries consolidated net profit rises 149.36% in the March 2026 quarter

Business Standard, 28 MayResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Vadilal Industries Seeks Shareholder Approval for Rs 1,426 Crore VEL Agreement

Whalesbook, 05 Oct

Vadilal Industries Share Price Target 2026: Rs 7,600 Analyst Forecast

Univest, 26 JunAnalyst view

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

Vadilal Industries Declares Rs 43/Share Dividend As Q4 Profit Rockets 150%

NDTV Profit, 27 MayCapital return

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

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate12.6/20

🟢Financial HealthStrong17.6/20

🟢GrowthStrong16.1/20

🟡ProfitabilityModerate9.5/15

🟡ValuationFair7.7/15

🟢RiskLow6.7/10

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 9% a year12.4% CAGR
✓EBITDA margin holds above 16%17.8%
✓Free cash flow remains positive₹47 Cr
✓Debt / EBITDA stays below 2x0.9x
✓ROCE stays above 18%20.8%