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Check Before You Invest : Suraj Industries Ltd

BSE: 526211 NSE: ISIN: INE170U01011
  |   Sector:  Miscellaneous   |   Industry:  Trading

Snapshot

Q.1 Which industry/sub-sector does Suraj Industries Ltd belong to?
Suraj Industries Ltd belongs to the Miscellaneous sector, operating specifically within the Trading segment.
Q.2 Is Suraj Industries Ltd a good quality company?
Suraj Industries 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 Suraj Industries Ltd undervalued or overvalued?
Suraj 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 - 31.37
Price to Book 1.16 3.02
Price to Sales 9.04 2.79
EV to EBITDA -252.03 22.64
Q.4 Is Suraj Industries Ltd a good buy now?
Suraj 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 Suraj Industries Ltd?
Suraj Industries Ltd revenue growth is -48.3% for FY-2025, which is below its 5-year CAGR of 82.17%, indicating slower growth.

Q.2 Gross Profit margin of Suraj Industries Ltd?
Suraj Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 1.1% for FY-2025, which is below its 5-year median of 6.6%, indicating decreasing margins.

Q.3 Operating Profit Margin of Suraj Industries Ltd?
Suraj Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is -6.53% for FY-2025, which is below its 5-year median of 7.34% indicating decreasing margins.

Q.4 Net Profit Margin of Suraj Industries Ltd?
Suraj Industries Ltd Net Profit Margin is -2.8% for FY-2025, is below its 5-year median of 5.31%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 1.1 6.6
Operating Profit Margin (%) -6.53 7.34
Net Profit Margin (%) -2.8 5.31

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Suraj Industries Ltd?
Suraj Industries Ltd Return on Asset is -1.14%, which is below its 5-year historical median of 8.91%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Suraj Industries Ltd?
Suraj Industries Ltd Return on capital employed is -0.84% for FY-2025, which is below its 5-year historical median of 7.15%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Cash conversion cycle of Suraj Industries Ltd?
Suraj Industries Ltd Cash conversion cycle is 26 days, above its 5-year historical median of 5 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.

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

Q.8 Debt to Equity ratio of Suraj Industries Ltd?
Suraj Industries Ltd Debt-to-Equity ratio is 0.03, which is lower the industry average of 0.03, indicating lower debt levels in the industry.

Q.9 Debt to cash flow from operations of Suraj Industries Ltd?
Suraj Industries Ltd Debt to cash flow from operations is 2.38, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Suraj Industries Ltd?

Q.1 Promoter shareholding and pledge status of Suraj Industries Ltd?
Promoters hold 39.48% of the Suraj Industries Ltd, with 14.64% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Suraj Industries Ltd vs industry peers?
Suraj Industries Ltd revenue CAGR is 82.17%, 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 (%) -48.3 -
Gross Profit Growth (%) -100 17.9
Operating Profit Growth (%) -150 16.4
Net Profit Growth (%) -150 17.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.47 0.52
ROE (%) - 2.05
ROCE (%) -0.84 3.6
Cash Conversion Cycle (days) 25.77 46

Valuation & price assessment

Q.1 Stock return of Suraj Industries Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 105.8% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- 105.8% -11% -12.8%
Q.2 Valuation ratios of Suraj Industries Ltd vs historical?
The current P/E ratio of 0 is lower than its historical median of 31.37, 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 - 31.37 33.62
Price to Book 1.16 3.02 1.57
Price to Sales 9.04 2.79 2.21
EV to EBITDA -252.03 22.64 14.09

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