Varvee Global Limited

Consumer Cyclical — Textile Manufacturing · NSE

₹57.40−₹3.16 (−5.22%)

DalalBaazaar Score

46 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, the company is currently loss-making.

In simple words: The company is currently losing money, though profits are falling even as sales grow. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:06 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 Varvee Global Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Varvee Global Limited engages in the manufacture and sale of fabrics in India and internationally. The company offers poplin, oxford, twill, dobby, chambray, and satin weaves, as well as other denims.

IndustryTextile Manufacturing

SectorConsumer Cyclical

Employees85

Annual revenue₹63 Cr

How does it make money?

Turns over ₹63 Cr a year. Of every ₹100 of sales, about ₹20 reaches shareholders as profit, with ₹36 left at the operating level before interest, tax and depreciation. Each of its 85 employees supports ₹73.6 lakh of revenue a year, the signature of a people-led business.

EBITDA margin36.4%

Net margin19.9%

Revenue / employee₹73.6 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.

MARUTI SUZUKI INDIA LTD.P/E 25.2x · ROE 13.4%

TITAN COMPANY LIMITEDP/E 68.5x · ROE 36.7%

TRENT LTDP/E 87.2x · ROE 25.9%

AVENUE SUPERMARTS LIMITEDP/E 69.9x · ROE 12.7%

What is its competitive advantage?Some evidence

ROCE of 24.8% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE24.8%

ROE16.2%

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 -76% while net margin moved -179% 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-76%

Margin effect-179%

DalalBaazaar Score

46/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 37.8% a year
✗ Profit fell 32.9% in the latest year

Quality vs. Valuation

Company Quality

49/ 100

Average

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

Valuation

39/ 100

Expensive

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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

P/E (Trailing)

Not meaningful

P/B

3.84x

EV/EBITDA

13.0x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from -10.9% to 36.4% over 3 years.
Debt is being paid down
Total debt is down 99% over 3 years.
Return on equity is rising
ROE has improved from -105.9% to 16.2%.
Return on capital is rising
ROCE has improved from -22.7% to 24.8%.
High return on capital employed
ROCE of 24.8% is the mark of a business that converts capital into profit efficiently.

🔴 What Needs Attention1

Short-term liquidity is tight
Current ratio of 0.59 — near-term obligations exceed near-term assets.

Red Flags

2 items require attention · 1 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 3.73x — earnings must service borrowings before shareholders see anything.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.59 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 24.8% 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.
Margin expansion has further to run
EBITDA margin has risen from -10.9% to 36.4%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 99% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 3.73x. Interest is payable whether or not the business has a good year.
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 34%✓ 36.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹0 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 22%✓ 24.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

₹296 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

3.84x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹-3.93

Loss-making

Negative earnings per share — the business is losing money

ROE

16.2%

Strong

Strong capital efficiency

ROCE

24.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

3.73x

High

High leverage

Revenue Growth (YoY)

47.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-32.9%

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

₹0 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹57.4

Operating Margin

-90.8%

Weak

Thin margins leave little room for error

Net Margin

-27.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.59

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.53

Defensive

Steadier than the market

52W Range Position

33%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

64.1 / 61.0

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

16.2

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹259 Cr	₹84 Cr	₹42 Cr	₹63 Cr	-37.8%
EBITDA	-₹28 Cr	-₹26 Cr	-₹61 Cr	₹23 Cr	—
EBITDA Margin	-10.9%	-31.4%	-145.1%	36.4%	—
PAT (Net Profit)	-₹65 Cr	-₹45 Cr	₹19 Cr	₹12 Cr	—
EPS	₹-13.87	₹-9.51	₹3.95	₹2.44	—
ROE	-105.9%	-259.4%	51.9%	16.2%	—
ROCE	-22.7%	-22.8%	53.1%	24.8%	—
Total Debt	₹397 Cr	₹278 Cr	₹94 Cr	₹3 Cr	-80.6%
Free Cash Flow	₹40 Cr	₹110 Cr	₹27 Cr	₹0 Cr	-78.1%

🔴 Revenue has shrunk at 37.8% a year over 3 years.

🟢 EBITDA has turned positive, from -₹28 Cr to ₹23 Cr.

🟢 EBITDA Margin has risen from -10.9% to 36.4% over 3 years (+47.4 pts).

🟢 PAT (Net Profit) has turned positive, from -₹65 Cr to ₹12 Cr.

🟢 EPS has turned positive, from ₹-13.87 to ₹2.44.

🟢 ROE has risen from -105.9% to 16.2% over 3 years (+122.1 pts).

🟢 ROCE has risen from -22.7% to 24.8% over 3 years (+47.5 pts).

🟢 Total Debt has shrunk at 80.6% a year over 3 years.

🔴 Free Cash Flow has shrunk at 78.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹184 Cr

Total Liabilities

₹107 Cr

Total Debt

₹3 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹5 Cr

Capex

-₹5 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

70.2%

Corporate Actions

Ex-Dividend Date

30 Aug 2012

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

1 positive1 mixed4 general

Varvee Global Share: Bull Case vs Bear Case for 2026

Univest, 29 Sept

Varvee Global begins e-voting for share split from ₹5 to ₹2

scanx.trade, 22 Sept

Varvee Global proposes share split, but disclosed capital figures signal ratio inconsistency

Dalal Street Investment Journal, 25 Sept

Varvee Global Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 03 Sept

Multibagger Varvee Global stock split record date approaches: Last chance to buy shares today to qualify for 1:2 split

Livemint, 27 FebCapital return

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

Varvee Global Share Analyst Review 2026: Price Target and Outlook

Univest, 15 JunAnalyst view

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

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

🟢Business QualityStrong13.9/20

🟡Financial HealthAdequate12/20

🔴GrowthWeak2.4/20

🟡ProfitabilityModerate8.5/15

🔴ValuationDemanding5.1/15

🔴RiskHigh3.9/10

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.

This thesis breaks if

✓EBITDA margin holds above 34%36.4%
✓Free cash flow remains positive₹0 Cr
✓Debt / EBITDA stays below 2x0.1x
✓ROCE stays above 22%24.8%