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Check Before You Invest : Dhunseri Tea & Industries Ltd

BSE: 538902 NSE: DTIL ISIN: INE341R01014
  |   Sector:  Agriculture & Allied activities   |   Industry:  Tea/Coffee

Snapshot

Q.1 Which industry/sub-sector does Dhunseri Tea & Industries Ltd belong to?
Dhunseri Tea & Industries Ltd belongs to the Agriculture & Allied activities sector, operating specifically within the Tea/Coffee segment.
Q.2 Is Dhunseri Tea & Industries Ltd a good quality company?
Dhunseri Tea & Industries 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 Dhunseri Tea & Industries Ltd undervalued or overvalued?
Dhunseri Tea & Industries 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 30.74 -
Price to Book 0.24 0.38
Price to Sales 0.41 0.94
EV to EBITDA 31.89 4.34
Q.4 Is Dhunseri Tea & Industries Ltd a good buy now?
Dhunseri Tea & Industries 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

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 Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd revenue growth is 10.1% for FY-2025, which is below its 5-year CAGR of 13.02%, indicating slower growth.

Q.2 Gross Profit margin of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is -3.9% for FY-2025, which is below its 5-year median of -1%, indicating decreasing margins.

Q.3 Operating Profit Margin of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is -2.57% for FY-2025, which is in line with its 5-year median of -2.57% indicating stable margins.

Q.4 Net Profit Margin of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Net Profit Margin is 0.71% for FY-2025, is above its 5-year median of -5.49%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) -3.9 -1
Operating Profit Margin (%) -2.57 -2.57
Net Profit Margin (%) 0.71 -5.49

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Return on Asset is 0.29%, which is above its 5-year historical median of -1.48%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Return on capital employed is 1.54% for FY-2025, which is above its 5-year historical median of -1.75%. 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 Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Return on equity is 0.43% for FY-2025, which is above its 5-year historical median of -1.99%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Cash conversion cycle is 20 days, below its 5-year historical median of 46 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) 0.41 0.31
ROE (%) 0.43 -1.99
ROCE (%) 1.54 -1.75
Cash Conversion Cycle 20 days 46 days

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

Q.9 Debt to Equity ratio of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Debt-to-Equity ratio is 0.18, which is lower the industry average of 0.21, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Dhunseri Tea & Industries Ltd?
Dhunseri Tea & Industries Ltd Debt to cash flow from operations is 6.58, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Dhunseri Tea & Industries Ltd?

Q.1 Promoter shareholding and pledge status of Dhunseri Tea & Industries Ltd?
Promoters hold 68.90% of the Dhunseri Tea & Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Dhunseri Tea & Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Dhunseri Tea & Industries Ltd vs industry peers?
Dhunseri Tea & Industries Ltd revenue CAGR is 13.02%, compared to the industry median CAGR of 3.64%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 10.1 3.6
Gross Profit Growth (%) 0 14.9
Operating Profit Growth (%) 0 0.5
Net Profit Growth (%) 0 8.5
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.41 0.68
ROE (%) 0.43 4.28
ROCE (%) 1.54 6.8
Cash Conversion Cycle (days) 20.41 46

Valuation & price assessment

Q.1 Stock return of Dhunseri Tea & Industries Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of -4% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
-4% -9.5% -14.1% -35.6%
Q.2 Valuation ratios of Dhunseri Tea & Industries Ltd vs historical?
The current P/E ratio of 30.74 is higher than its historical median of , 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 30.74 - 21.84
Price to Book 0.24 0.38 0.99
Price to Sales 0.41 0.94 1.07
EV to EBITDA 31.89 4.34 14.06

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