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Check Before You Invest : Libas Consumer Products Ltd

BSE: 0 NSE: LIBAS ISIN: INE908V01012
  |   Sector:  Textiles & Apparels   |   Industry:  Textile

Snapshot

Q.1 Which industry/sub-sector does Libas Consumer Products Ltd belong to?
Libas Consumer Products Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile segment.
Q.2 Is Libas Consumer Products Ltd a good quality company?
Libas Consumer Products Ltd is a quality company, based on a multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Libas Consumer Products Ltd undervalued or overvalued?
Libas Consumer Products Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings - 14.93
Price to Book 0.66 0.86
Price to Sales 0.52 0.95
EV to EBITDA 12.05 10.62
Q.4 Is Libas Consumer Products Ltd a good buy now?
Libas Consumer Products Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Libas Consumer Products Ltd?
Libas Consumer Products Ltd revenue growth is 36.1% for FY-2025, which is above its 5-year CAGR of 10.59%, indicating faster growth.

Q.2 Gross Profit margin of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Gross profit margin which is the profit after deduction of direct costs, is -2.1% for FY-2025, which is below its 5-year median of 4.9%, indicating decreasing margins.

Q.3 Operating Profit Margin of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is -0.12% for FY-2025, which is below its 5-year median of 6.07% indicating decreasing margins.

Q.4 Net Profit Margin of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Net Profit Margin is -2.87% for FY-2025, is below its 5-year median of 0.25%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) -2.1 4.9
Operating Profit Margin (%) -0.12 6.07
Net Profit Margin (%) -2.87 0.25

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Return on Asset is -2.07%, which is below its 5-year historical median of 0.14%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Return on capital employed is 0.12% for FY-2025, which is below its 5-year historical median of 1.75%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Return on equity is -3.08% for FY-2025, which is below its 5-year historical median of 0.19%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Cash conversion cycle is 262 days, in line with its 5-year historical median of 268 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.72 0.66
ROE (%) -3.08 0.19
ROCE (%) 0.12 1.75
Cash Conversion Cycle 262 days 268 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Debt-to-Equity ratio is 0.27, which is lower the industry average of 0.42, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Libas Consumer Products Ltd?
Libas Consumer Products Ltd Debt to cash flow from operations is 3.39, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Libas Consumer Products Ltd?

Q.1 Promoter shareholding and pledge status of Libas Consumer Products Ltd?
Promoters hold 31.55% of the Libas Consumer Products Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Libas Consumer Products Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Libas Consumer Products Ltd vs industry peers?
Libas Consumer Products Ltd revenue CAGR is 10.59%, compared to the industry median CAGR of 0%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 36.1 -
Gross Profit Growth (%) -435.3 9.1
Operating Profit Growth (%) 0 8.5
Net Profit Growth (%) -1,670 13
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.72 0.95
ROE (%) -3.08 4.34
ROCE (%) 0.12 7.56
Cash Conversion Cycle (days) 262.08 101

Valuation & price assessment

Q.1 Stock return of Libas Consumer Products Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of -23.97% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- -24% 0.9% -5%
Q.2 Valuation ratios of Libas Consumer Products Ltd vs historical?
The current P/E ratio of 0 is lower than its historical median of 14.93, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings - 14.93 20.16
Price to Book 0.66 0.86 1.32
Price to Sales 0.52 0.95 1.06
EV to EBITDA 12.05 10.62 9.31

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