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Check Before You Invest : Swastik Pipes Ltd

BSE: 0 NSE: SWASTIK ISIN: INE0DGC01025
  |   Sector:  Metals & Mining   |   Industry:  Steel & Iron Products

Snapshot

Q.1 Which industry/sub-sector does Swastik Pipes Ltd belong to?
Swastik Pipes Ltd belongs to the Metals & Mining sector, operating specifically within the Steel & Iron Products segment.
Q.2 Is Swastik Pipes Ltd a good quality company?
Swastik Pipes 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 Swastik Pipes Ltd undervalued or overvalued?
Swastik Pipes Ltd appears 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 - 17.75
Price to Book 0.26 0.71
Price to Sales 0.07 0.20
EV to EBITDA 8.24 8.49
Q.4 Is Swastik Pipes Ltd a good buy now?
Swastik Pipes 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 Swastik Pipes Ltd?
Swastik Pipes Ltd revenue growth is 3.3% for FY-2025, which is above its 5-year CAGR of 2.65%, indicating faster growth.

Q.2 Gross Profit margin of Swastik Pipes Ltd?
Swastik Pipes Ltd Gross profit margin which is the profit after deduction of direct costs, is -0.5% for FY-2025, which is below its 5-year median of 1.7%, indicating decreasing margins.

Q.3 Operating Profit Margin of Swastik Pipes Ltd?
Swastik Pipes Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 2.53% for FY-2025, which is below its 5-year median of 3.84% indicating decreasing margins.

Q.4 Net Profit Margin of Swastik Pipes Ltd?
Swastik Pipes Ltd Net Profit Margin is -0.97% for FY-2025, is below its 5-year median of 0.71%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) -0.5 1.7
Operating Profit Margin (%) 2.53 3.84
Net Profit Margin (%) -0.97 0.71

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Swastik Pipes Ltd?
Swastik Pipes Ltd Return on Asset is -1.49%, which is below its 5-year historical median of 1.22%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Swastik Pipes Ltd?
Swastik Pipes Ltd Return on capital employed is 4.26% for FY-2025, which is below its 5-year historical median of 9.07%. 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 Swastik Pipes Ltd?
Swastik Pipes Ltd Return on equity is -3.44% for FY-2025, which is below its 5-year historical median of 2.43%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Swastik Pipes Ltd?
Swastik Pipes Ltd Cash conversion cycle is 73 days, below its 5-year historical median of 87 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) 1.54 1.72
ROE (%) -3.44 2.43
ROCE (%) 4.26 9.07
Cash Conversion Cycle 73 days 87 days

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

Q.9 Debt to Equity ratio of Swastik Pipes Ltd?
Swastik Pipes Ltd Debt-to-Equity ratio is 0.61, which is above the industry average of 0.31, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Swastik Pipes Ltd?
Swastik Pipes Ltd Debt to cash flow from operations is 5.3, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Swastik Pipes Ltd?

Q.1 Promoter shareholding and pledge status of Swastik Pipes Ltd?
Promoters hold 64.51% of the Swastik Pipes Ltd, with 38.09% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Swastik Pipes Ltd vs industry peers?
Swastik Pipes Ltd revenue CAGR is 2.65%, compared to the industry median CAGR of 7.56%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 3.3 7.6
Gross Profit Growth (%) -130.9 19.3
Operating Profit Growth (%) -19.9 13.8
Net Profit Growth (%) -240.7 24.6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.54 1.27
ROE (%) -3.44 8.04
ROCE (%) 4.26 11.28
Cash Conversion Cycle (days) 73.11 72

Valuation & price assessment

Q.1 Stock return of Swastik Pipes Ltd over the last decade?
Over the last 3 year(s), the stock has delivered a CAGR of -33.78% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - -33.8% -43.4%
Q.2 Valuation ratios of Swastik Pipes Ltd vs historical?
The current P/E ratio of 0 is lower than its historical median of 17.75, 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 - 17.75 17.36
Price to Book 0.26 0.71 1.63
Price to Sales 0.07 0.20 0.74
EV to EBITDA 8.24 8.49 10.05

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