Check Before You Invest : Sonam Ltd

Q: 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: Is Sonam Ltd a good quality company?

Sonam Ltd is a good quality company, based on a consistently good 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: Is Sonam Ltd undervalued or overvalued?

Sonam Ltd appears Fair, as its key valuation ratios are in line with 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. Price to Earnings, Current: 37.19, Historic Median: 28.22. Price to Book, Current: 4.13, Historic Median: 3.29. Price to Sales, Current: 1.64, Historic Median: 1.48. EV to EBITDA, Current: 19.33, Historic Median: 14.64

Q: Is Sonam Ltd a good buy now?

Sonam Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of Sonam Ltd?

Sonam Ltd revenue growth is 18.8% for FY-2025, which is above its 5-year CAGR of 11.67%, indicating faster growth.

Q: 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: 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: Net Profit Margin of Sonam Ltd?

Sonam Ltd Net Profit Margin is 6.08% for FY-2025, is above its 5-year median of 4.84%, indicating increasing margins. Profitability Metrics. Gross Profit Margin (%), Current: 10.9, Historic Median: 8.5. Operating Profit Margin (%), Current: 11.6, Historic Median: 10.74. Net Profit Margin (%), Current: 6.08, Historic Median: 4.84

Q: 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: Return on capital employed (ROCE) of Sonam Ltd?

Sonam Ltd Return on capital employed is 15.87% for FY-2025, which is above its 5-year historical median of 11.42%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Check Before You Invest : Sonam Ltd

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 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 Sonam Ltd undervalued or overvalued?

Sonam Ltd appears Fair, as its key valuation ratios are in line with 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	37.19	28.22
Price to Book	4.13	3.29
Price to Sales	1.64	1.48
EV to EBITDA	19.33	14.64

Q.4 Is Sonam Ltd a good buy now?

Sonam Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. 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 Sonam Ltd?

Sonam Ltd revenue growth is 18.8% for FY-2025, which is above its 5-year CAGR of 11.67%, 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 its 5-year median of 4.84%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	10.9	8.5
Operating Profit Margin (%)	11.6	10.74
Net Profit Margin (%)	6.08	4.84

B: Does the business utilize capital efficiently?

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 capital employed (ROCE) of Sonam Ltd?

Sonam Ltd Return on capital employed is 15.87% for FY-2025, which is above its 5-year historical median of 11.42%. 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 Sonam Ltd?

Sonam Ltd Return on equity is 13.33% for FY-2025, which is above its 5-year historical median of 11.63%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Sonam Ltd?

Sonam Ltd Cash conversion cycle is 94 days, below its 5-year historical median of 103 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	1.13	1.02
ROE (%)	13.33	11.63
ROCE (%)	15.87	11.42
Cash Conversion Cycle	94 days	103 days

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

Q.9 Debt to Equity ratio of Sonam Ltd?

Sonam Ltd Debt-to-Equity ratio is 0.36, which is lower the industry average of 0.40, 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

D: Promoter shareholding and pledge status of Sonam Ltd?

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)

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

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	5-year Industry Median
Revenue Growth (%)	18.8	15.4
Gross Profit Growth (%)	10	24.6
Operating Profit Growth (%)	-	20.1
Net Profit Growth (%)	-	27.6

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	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 -1.4% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	-	-1.4%	2.4%	45.9%

Q.2 Valuation ratios of Sonam Ltd vs historical?

The current P/E ratio of 37.19 is higher than its historical median of 28.22, indicating that the stock is trading above 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	37.19	28.22	40.88
Price to Book	4.13	3.29	7.79
Price to Sales	1.64	1.48	3.73
EV to EBITDA	19.33	14.64	19.77

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Check Before You Invest : Sonam Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

Check more companies

Check trending companies

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