MoneyWorks4Me

Check Before You Invest : RDB Rasayans Ltd

BSE: 533608 NSE: ISIN: INE123M01017
  |   Sector:  Chemicals & Fertilizers   |   Industry:  Plastic Products

Snapshot

Q.1 Which industry/sub-sector does RDB Rasayans Ltd belong to?
RDB Rasayans Ltd belongs to the Chemicals & Fertilizers sector, operating specifically within the Plastic Products segment.
Q.2 Is RDB Rasayans Ltd a good quality company?
RDB Rasayans Ltd is a average quality company, based on a somewhat consistent 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 RDB Rasayans Ltd undervalued or overvalued?
RDB Rasayans 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 8.56 8.56
Price to Book 1.18 1.22
Price to Sales 2.47 1.85
EV to EBITDA 6.06 5.86
Q.4 Is RDB Rasayans Ltd a good buy now?
RDB Rasayans 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 RDB Rasayans Ltd?
RDB Rasayans Ltd revenue growth is -20.6% for FY-2026, which is below its 5-year CAGR of 4.97%, indicating slower growth.

Q.2 Gross Profit margin of RDB Rasayans Ltd?
RDB Rasayans Ltd Gross profit margin which is the profit after deduction of direct costs, is 39.8% for FY-2026, which is above its 5-year median of 31.1%, indicating increasing margins.

Q.3 Operating Profit Margin of RDB Rasayans Ltd?
RDB Rasayans Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 18.29% for FY-2026, which is above its 5-year median of 15.97% indicating increasing margins.

Q.4 Net Profit Margin of RDB Rasayans Ltd?
RDB Rasayans Ltd Net Profit Margin is 28.84% for FY-2026, is above its 5-year median of 22.27%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 39.8 31.1
Operating Profit Margin (%) 18.29 15.97
Net Profit Margin (%) 28.84 22.27

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of RDB Rasayans Ltd?
RDB Rasayans Ltd Return on Asset is 13.47%, which is in line with its 5-year historical median of 13.47%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of RDB Rasayans Ltd?
RDB Rasayans Ltd Return on capital employed is 19.86% for FY-2026, which is in line with its 5-year historical median of 19.86%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of RDB Rasayans Ltd?
RDB Rasayans Ltd Return on equity is 14.76% for FY-2026, which is in line with its 5-year historical median of 14.76%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of RDB Rasayans Ltd?
RDB Rasayans Ltd Cash conversion cycle is 62 days, above its 5-year historical median of 55 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.47 0.66
ROE (%) 14.76 14.76
ROCE (%) 19.86 19.86
Cash Conversion Cycle 62 days 55 days

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

Q.9 Debt to Equity ratio of RDB Rasayans Ltd?
RDB Rasayans Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.25, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of RDB Rasayans Ltd?
RDB Rasayans Ltd Debt to cash flow from operations is -0.04, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of RDB Rasayans Ltd?

Q.1 Promoter shareholding and pledge status of RDB Rasayans Ltd?
Promoters hold 69.83% of the RDB Rasayans Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does RDB Rasayans Ltd performance compare with that of its Peers?

Q.1 Revenue growth of RDB Rasayans Ltd vs industry peers?
RDB Rasayans Ltd revenue CAGR is 4.97%, compared to the industry median CAGR of 3.92%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -20.6 3.9
Gross Profit Growth (%) 27 14.3
Operating Profit Growth (%) 46.7 9.1
Net Profit Growth (%) 30.8 18.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.47 1.14
ROE (%) 14.76 6.84
ROCE (%) 19.86 8.9
Cash Conversion Cycle (days) 62.05 72

Valuation & price assessment

Q.1 Stock return of RDB Rasayans Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 20% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
20% 15% 15.2% 1%
Q.2 Valuation ratios of RDB Rasayans Ltd vs historical?
The current P/E ratio of 8.56 is in line with than its historical median of 8.56, indicating that the stock is trading near 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 8.56 8.56 22.05
Price to Book 1.18 1.22 1.89
Price to Sales 2.47 1.85 1.33
EV to EBITDA 6.06 5.86 10.86

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