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Check Before You Invest : Thomas Scott (India) Ltd

BSE: 533941 NSE: THOMASCOTT ISIN: INE480M01011
  |   Sector:  Textiles & Apparels   |   Industry:  Textile

Snapshot

Q.1 Which industry/sub-sector does Thomas Scott (India) Ltd belong to?
Thomas Scott (India) Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile segment.
Q.2 Is Thomas Scott (India) Ltd a good quality company?
Thomas Scott (India) Ltd is a weak quality company, based on a inconsistent 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 Thomas Scott (India) Ltd undervalued or overvalued?
Thomas Scott (India) Ltd appears Overvalued, as its key valuation ratios are higher 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 25.6 28.11
Price to Book 3.38 3.69
Price to Sales 1.97 1.66
EV to EBITDA 16.04 17.64
Q.4 Is Thomas Scott (India) Ltd a good buy now?
Thomas Scott (India) 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 Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd revenue growth is 76.5% for FY-2025, which is above its 5-year CAGR of 49.23%, indicating faster growth.

Q.2 Gross Profit margin of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Gross profit margin which is the profit after deduction of direct costs, is 10.4% for FY-2025, which is above its 5-year median of 5.7%, indicating increasing margins.

Q.3 Operating Profit Margin of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 12.06% for FY-2025, which is above its 5-year median of 7.46% indicating increasing margins.

Q.4 Net Profit Margin of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Net Profit Margin is 7.95% for FY-2025, is above its 5-year median of 4.59%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 10.4 5.7
Operating Profit Margin (%) 12.06 7.46
Net Profit Margin (%) 7.95 4.59

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Return on Asset is 12.22%, which is above its 5-year historical median of 5.09%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Return on capital employed is 20.33% for FY-2025, which is in line with its 5-year historical median of 20.33%. 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 Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Return on equity is 17.99% for FY-2025, which is in line with its 5-year historical median of 17.99%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Cash conversion cycle is 147 days, above its 5-year historical median of 52 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) 1.67 1.14
ROE (%) 17.99 17.99
ROCE (%) 20.33 20.33
Cash Conversion Cycle 147 days 52 days

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

Q.9 Debt to Equity ratio of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Debt-to-Equity ratio is 0.13, which is lower the industry average of 0.42, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Thomas Scott (India) Ltd?
Thomas Scott (India) Ltd Debt to cash flow from operations is -0.34, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Thomas Scott (India) Ltd?

Q.1 Promoter shareholding and pledge status of Thomas Scott (India) Ltd?
Promoters hold 52.32% of the Thomas Scott (India) Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Thomas Scott (India) Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Thomas Scott (India) Ltd vs industry peers?
Thomas Scott (India) Ltd revenue CAGR is 49.23%, compared to the industry median CAGR of 0.00%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 76.5 0
Gross Profit Growth (%) 63.6 9.1
Operating Profit Growth (%) 46.2 8.5
Net Profit Growth (%) 30 13
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.67 0.95
ROE (%) 17.99 4.25
ROCE (%) 20.33 7.55
Cash Conversion Cycle (days) 147.06 102

Valuation & price assessment

Q.1 Stock return of Thomas Scott (India) Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 41.1% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
41.1% 118.3% 87.4% -3.6%
Q.2 Valuation ratios of Thomas Scott (India) Ltd vs historical?
The current P/E ratio of 25.6 is lower than its historical median of 28.11, 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 25.6 28.11 20.16
Price to Book 3.38 3.69 1.32
Price to Sales 1.97 1.66 1.06
EV to EBITDA 16.04 17.64 9.31

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