Valson Industries Limited

Consumer Cyclical — Textile Manufacturing · BSE

₹39.11−₹0.06 (−0.15%)

DalalBaazaar Score

48 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment, falling profits.

In simple words: The business is earning a fairly low return on the money invested in it, though profits are falling even as sales grow. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

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

What does this company do?

Valson Industries Limited manufactures and sells polyester texturized and twisted yarns under the VALSON brand name in India and internationally. The company is engaged in the processing of cotton, polyester, and other fancy yarns.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees534

Annual revenue₹111 Cr

How does it make money?

Turns over ₹111 Cr a year. Of every ₹100 of sales, about ₹0 reaches shareholders as profit, with ₹4 left at the operating level before interest, tax and depreciation. Each of its 534 employees supports ₹20.9 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹20.9 lakh

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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?Little sign of one

Returns on capital of 4.1% 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.

Peer median ROE25.9%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -14% while net margin moved +3027% 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-14%

Margin effect+3027%

DalalBaazaar Score

48/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 1.7% is weak

Quality vs. Valuation

Company Quality

50/ 100

Average

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

Valuation

53/ 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

62.1x

3Y Median

36.3x

40 monthly readings · mean 459.9x · range 18.1x–1929.0x

Sector Median

69.2x

median of 4 sector peers

⚠️Current valuation is approximately 71% above its 3y median of 36.3x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟡Against its sector it is priced broadly in line with the peer median of 69.2x.

vs. its own history

Expensive

36.3x median over 40 months · +71%

vs. sector peers

Fair

69.2x median of 4 peers · -10%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

10.8x

PEG

0.31

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 14% over 3 years.
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 · 1 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.3x — little room if earnings dip.
🟡Inventory building faster than salesFinancial
Inventory up 32% against revenue up -14% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹1 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?

The debt load needs earnings to hold up
Debt is 3.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 71% 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

1EBITDA margin holds above 2%✓ 3.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 3.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 1.3x
How much operating profit can fall before interest stops being comfortably covered.
4Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ 4.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 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 · 3 neutral · 4 weak

Market Cap

₹30 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

62.1x

Expensive

Expensive — verify against sector peers

P/B Ratio

1.05x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.63

Profitable

Profitable on a per-share basis

ROE

1.7%

Weak

Weak capital efficiency

ROCE

4.1%

Weak

Low return on total capital employed

Debt/Equity

0.50x

Low

Conservative leverage

Revenue Growth (YoY)

1.2%

Modest

Modest growth

Profit Growth (YoY)

-25.0%

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

₹1 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

0.6%

Weak

Thin margins leave little room for error

Net Margin

0.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.60

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.01

Defensive

Steadier than the market

52W Range Position

64%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

40.8 / 41.5

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

42.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹130 Cr	₹124 Cr	₹130 Cr	₹111 Cr	-4.9%
EBITDA	₹5 Cr	₹4 Cr	₹5 Cr	₹4 Cr	-5.3%
EBITDA Margin	3.7%	3.5%	3.5%	3.6%	—
PAT (Net Profit)	₹0 Cr	₹1 Cr	₹1 Cr	₹0 Cr	+199.6%
EPS	₹0.02	₹1.28	₹0.79	₹0.63	+215.8%
ROE	0.1%	3.6%	2.2%	1.7%	—
ROCE	4.7%	4.8%	4.9%	4.1%	—
Total Debt	₹16 Cr	₹17 Cr	₹14 Cr	₹14 Cr	-5.1%
Free Cash Flow	₹2 Cr	₹0 Cr	₹4 Cr	₹1 Cr	-23.7%

🔴 Revenue has shrunk at 4.9% a year over 3 years.

🔴 EBITDA has shrunk at 5.3% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 3.6% over 3 years.

🟢 PAT (Net Profit) has grown at 199.6% a year over 3 years.

🟢 EPS has grown at 215.8% a year over 3 years.

🟢 ROE has risen from 0.1% to 1.7% over 3 years (+1.6 pts).

🟡 ROCE has held roughly flat at 4.1% over 3 years.

🟢 Total Debt has shrunk at 5.1% a year over 3 years.

🔴 Free Cash Flow has shrunk at 23.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹54 Cr

Total Liabilities

₹26 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹2 Cr

Capex

-₹1 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

78.1%

Corporate Actions

Ex-Dividend Date

20 Sept 2019

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

2 mixed4 general

Top 15 Low-Price Stocks In India To Buy In October 2026

Samco, 17 Oct

Valson Industries Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 29 Aug

Valson Industries shareholders approve FY26 financials, director re-appointment

scanx.trade, 19 Sept

VALSON INDUSTRIES LTD. Share Price - Live VALSONQ Stock Price & Chart

Upstox, 26 Mar

Q1 Results Tracker: Tata Motors, Vodafone Idea among 2,045 companies set to announce earnings this week

The Economic Times, 09 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Valson Industries Q1 Results 2026 - Find Valson Industries Q1 Earnings Result | Valson Industries Q1 results

Livemint, 24 DecResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health

MiddlingGrowth

WeakBusiness Quality · Profitability · Valuation · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 1 high-severity red flag sits above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑