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Check Before You Invest : Rex Sealing and Packing Industries Ltd

BSE: 543744 NSE: ISIN: INE0MFT01014
  |   Sector:  Agriculture & Allied activities   |   Industry:  Rubber Products

Snapshot

Q.1 Which industry/sub-sector does Rex Sealing and Packing Industries Ltd belong to?
Rex Sealing and Packing Industries Ltd belongs to the Agriculture & Allied activities sector, operating specifically within the Rubber Products segment.
Q.2 Is Rex Sealing and Packing Industries Ltd a good quality company?
Rex Sealing and Packing Industries 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 Rex Sealing and Packing Industries Ltd undervalued or overvalued?
Rex Sealing and Packing Industries Ltd appears Somewhat Undervalued, as its key valuation ratios are lower 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 19.39 23.44
Price to Book 1.52 2.04
Price to Sales 1.08 1.23
EV to EBITDA 13.76 15.12
Q.4 Is Rex Sealing and Packing Industries Ltd a good buy now?
Rex Sealing and Packing Industries 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 Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd revenue growth is 13.7% for FY-2025, which is above its 5-year CAGR of 11.65%, indicating faster growth.

Q.2 Gross Profit margin of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 8.4% for FY-2025, which is above its 5-year median of 5.4%, indicating increasing margins.

Q.3 Operating Profit Margin of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.25% for FY-2025, which is above its 5-year median of 7.57% indicating increasing margins.

Q.4 Net Profit Margin of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Net Profit Margin is 5.55% for FY-2025, is above its 5-year median of 2.15%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 8.4 5.4
Operating Profit Margin (%) 9.25 7.57
Net Profit Margin (%) 5.55 2.15

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Return on Asset is 7.19%, which is above its 5-year historical median of 2.8%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Return on capital employed is 12.94% for FY-2025, which is above its 5-year historical median of 8.99%. 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 Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Return on equity is 12.1% for FY-2025, which is above its 5-year historical median of 4.9%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Cash conversion cycle is 141 days, above its 5-year historical median of 131 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) 1.29 1.56
ROE (%) 12.1 4.9
ROCE (%) 12.94 8.99
Cash Conversion Cycle 141 days 131 days

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

Q.9 Debt to Equity ratio of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Debt-to-Equity ratio is 0.64, which is above the industry average of 0.44, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Rex Sealing and Packing Industries Ltd?
Rex Sealing and Packing Industries Ltd Debt to cash flow from operations is -5.88, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Rex Sealing and Packing Industries Ltd?

Q.1 Promoter shareholding and pledge status of Rex Sealing and Packing Industries Ltd?
Promoters hold 63.95% of the Rex Sealing and Packing Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Rex Sealing and Packing Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Rex Sealing and Packing Industries Ltd vs industry peers?
Rex Sealing and Packing Industries Ltd revenue CAGR is 11.65%, compared to the industry median CAGR of 8.96%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 13.7 9
Gross Profit Growth (%) -27.9 18.5
Operating Profit Growth (%) -25.3 13.1
Net Profit Growth (%) -21.2 20.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.29 1.31
ROE (%) 12.1 5.31
ROCE (%) 12.94 7.92
Cash Conversion Cycle (days) 141.46 76

Valuation & price assessment

Q.1 Stock return of Rex Sealing and Packing Industries Ltd over the last decade?
Over the last 3 year(s), the stock has delivered a CAGR of 0.7% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - 0.7% -21.6%
Q.2 Valuation ratios of Rex Sealing and Packing Industries Ltd vs historical?
The current P/E ratio of 19.39 is lower than its historical median of 23.44, 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 19.39 23.44 25.04
Price to Book 1.52 2.04 2.69
Price to Sales 1.08 1.23 1.31
EV to EBITDA 13.76 15.12 13.74

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