Vaxtex Cotfab Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹1.48+₹0.05 (+3.50%)

DalalBaazaar Score

74 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

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

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Vaxtex Cotfab Limited manufactures and sells textile products in India. The company processes and trades in suiting, shirting, and denim fabrics made from cotton and polyester blends, as well as fabrics with specialized finishes, including pigment and reactive dyeing.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees6

Annual revenue₹11 Cr

How does it make money?

Turns over ₹11 Cr a year. Of every ₹100 of sales, about ₹49 reaches shareholders as profit, with ₹44 left at the operating level before interest, tax and depreciation. Each of its 6 employees supports ₹1.86 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.86 Cr

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?Some evidence

ROCE of 21.1% 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 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 -83% while net margin moved +2830% 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-83%

Margin effect+2830%

DalalBaazaar Score

74/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.66 — historically steadier than the index
✗ 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

76/ 100

Good

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.

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

Historical Valuation

Current P/E

5.1x

3Y Median

11.8x

40 monthly readings · mean 16.0x · range 4.4x–44.4x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 57% below its 3y median of 11.8x. 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 93% below the peer median of 69.2x.

vs. its own history

Cheap

11.8x median over 40 months · -57%

vs. sector peers

Cheap

69.2x median of 4 peers · -93%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

6.6x

PEG

0.07

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 1.8% to 43.6% over 3 years.
Return on equity is rising
ROE has improved from 4.8% to 24.6%.
Return on capital is rising
ROCE has improved from 6.2% to 21.1%.
High return on capital employed
ROCE of 21.1% is the mark of a business that converts capital into profit efficiently.
Very low debt
Debt/Equity of 0.23x leaves the balance sheet with plenty of headroom.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

4 items require attention · 2 high · 2 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.
🔴Inventory building faster than salesFinancial
Inventory up 432% against revenue up -83% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹2 Cr in the latest year.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 38% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 21.1% 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 1.8% to 43.6%. 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 57% 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 93% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

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.
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

1EBITDA margin holds above 42%✓ 43.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹2 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 1.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 18%✓ 21.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 11.8x✓ 5.1x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

9 / 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

8 good · 2 neutral · 1 weak

Market Cap

₹27 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

5.1x

Cheap

Cheap against the generic band

P/B Ratio

1.23x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.29

Profitable

Profitable on a per-share basis

ROE

24.6%

Strong

Strong capital efficiency

ROCE

21.1%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.23x

Low

Conservative leverage

Revenue Growth (YoY)

112.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

525.3%

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

-₹2 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

-361.2%

Weak

Thin margins leave little room for error

Net Margin

47.1%

Good

Strong bottom-line conversion

Current Ratio

2.84

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.66

Defensive

Steadier than the market

52W Range Position

34%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1.5 / 1.6

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

57.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹67 Cr	₹17 Cr	₹5 Cr	₹11 Cr	-45.0%
EBITDA	₹1 Cr	-₹6 Cr	₹1 Cr	₹5 Cr	+58.1%
EBITDA Margin	1.8%	-35.3%	21.6%	43.6%	—
PAT (Net Profit)	₹1 Cr	-₹9 Cr	₹1 Cr	₹6 Cr	+69.6%
EPS	₹0.1	₹-0.59	₹0.05	₹0.3	+42.3%
ROE	4.8%	-47.0%	4.8%	24.6%	—
ROCE	6.2%	-30.2%	2.0%	21.1%	—
Total Debt	₹5 Cr	₹12 Cr	₹11 Cr	₹5 Cr	+0.4%
Free Cash Flow	-₹11 Cr	-₹48 Cr	₹1 Cr	-₹2 Cr	—

🔴 Revenue has shrunk at 45.0% a year over 3 years.

🟢 EBITDA has grown at 58.1% a year over 3 years.

🟢 EBITDA Margin has risen from 1.8% to 43.6% over 3 years (+41.8 pts).

🟢 PAT (Net Profit) has grown at 69.6% a year over 3 years.

🟢 EPS has grown at 42.3% a year over 3 years.

🟢 ROE has risen from 4.8% to 24.6% over 3 years (+19.8 pts).

🟢 ROCE has risen from 6.2% to 21.1% over 3 years (+14.9 pts).

🟡 Total Debt has been broadly flat over 3 years (0.4% a year).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹37 Cr

Total Liabilities

₹14 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹2 Cr

Capex

—

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

Vaxtex Cotfab Limited (VCL.NS) Slips 3.85% to ₹1.50 as Penny Stock Tests Key Support - Sentiment Divergence

https://www.siam.in/, 09 Oct

Vaxtex Cotfab Share Price Target 2027, 2028 and 2030: Long Term Analyst Forecast

Univest, 11 AugAnalyst view

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

Vaxtex Cotfab promoter seeks reclassification to public category

scanx.trade, 21 Jul

Compare with

Equitymaster, 10 Oct

Vaxtex Cotfab Share Price Target 2026: Rs 1.55 Analyst Forecast

Univest, 26 JunAnalyst view

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

VAXTEX COTFAB LIMITED Share Price - Live NSE: VCL Stock Price & Chart

Upstox, 28 Mar

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Profitability · Valuation

MiddlingGrowth

WeakRisk

Points for each in the Score ↑

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.

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