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INVESTMENT INSIGHTS

Check Before You Invest : Sonam Ltd

BSE: 0 NSE: SONAMLTD ISIN: INE00LM01029
  |   Sector:  Consumer Durables   |   Industry:  Watches & Accessories

Snapshot

Q.1 Which industry/sub-sector does Sonam Ltd belong to?
Sonam Ltd belongs to the Consumer Durables sector, operating specifically within the Watches & Accessories segment.
Q.2 Is Sonam Ltd a good quality company?
Sonam Ltd is a good quality company, based on a consistently good 10 year financial track record.
Q.3 Is Sonam Ltd undervalued or overvalued?
Sonam Ltd appears Fair, as its key valuation ratios are in line with their past averages.
Q.4 Is Sonam Ltd a good buy now?
Sonam Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Sonam Ltd?
Sonam Ltd revenue growth is 18.8% for FY-2025 , which is above its 5 year CAGR of 11.7% , indicating faster growth.
Q.2 Gross Profit margin of Sonam Ltd?
Sonam Ltd Gross profit margin which is the profit after deduction of direct costs, is 10.9% for FY-2025 , which is above its 5 year median of 8.5% , indicating increasing margins.
Q.3 Operating Profit Margin of Sonam Ltd?
Sonam Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 11.6% for FY-2025 , which is above its 5 year median of 10.74% indicating increasing margins.
Q.4 Net Profit Margin of Sonam Ltd?
Sonam Ltd Net Profit Margin is 6.08% for FY-2025 , is above with its 5 year median of 4.84%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 10.9 8.5
Operating Profit Margin 11.6 10.74
Net Profit Margin 6.08 4.84
Q.5 Return on Asset of Sonam Ltd?
Sonam Ltd Return on Asset is 6.89%, which is above its 5 year historical median of 4.73%, indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Sonam Ltd?
Sonam Ltd Return on equity is 13.33% for FY-2025 , which is above its historical median of 11.63%, indicating the business is making better use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Sonam Ltd?
Sonam Ltd Return on capital employed is 15.87% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 14%, indicating value creation.
Q.8 Cash conversion cycle of Sonam Ltd?
Sonam Ltd Cash conversion cycle is 94 days, below its historical median of 103 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 1.13 1.02
ROE 13.33 11.63
ROCE 15.87 11.42
Cash Conversion Cycle 94 days 103 days
Q.9 Debt to Equity ratio of Sonam Ltd?
Sonam Ltd Debt-to-Equity ratio is 0.36 , which is lower with the industry average of 0.4 , indicating lower debt levels in the industry.
Q.10 Debt to cash flow from operations of Sonam Ltd?
Sonam Ltd Debt to cash flow from operations is 1.77 , which is at a moderate level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Sonam Ltd?
Promoters hold 57.55% of the Sonam Ltd, with 3.65% of their stake pledged, indicating low pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Sonam Ltd vs industry peers?
Sonam Ltd revenue CAGR is 11.67% , compared to the industry median CAGR of 15.40% , indicating slower growth and losing its market share.
Profit Metrics
Current Level Industry Median
Revenue 104.1 304.8
Gross Profit 11.3 27.2
Operating Profit 12 32
Net Profit 6 21
Operating Efficiency
Current Level Industry Median
Asset Turnover 1.13 1.02
ROE 13.33 11.63
ROCE 15.87 15.73
Cash Conversion Cycle (days) 94.24 72

Valuation & price assessment

Q.1 Stock return of Sonam Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of -3.77% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price - -3.8% 10.5% 18%
Q.3 Valuation ratios of Sonam Ltd vs historical?
The current P/E is lower that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 34.92 35.92 42.49
Price to Book 3.88 3.13 5.44
Price to Sales 1.54 1.59 2.57
EV to EBITDA 18.24 16.13 16.96

Check more companies

1. Timex Group India
2. KDDL
3. Sonam
4. Opal Luxury Time
5. M&I Watches
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