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Check Before You Invest : Globe Commercials Ltd

BSE: 540266 NSE: ISIN: INE804Q01013
  |   Sector:  Miscellaneous   |   Industry:  Trading

Snapshot

Q.1 Which industry/sub-sector does Globe Commercials Ltd belong to?
Globe Commercials Ltd belongs to the Miscellaneous sector, operating specifically within the Trading segment.
Q.2 Is Globe Commercials Ltd a good quality company?
Globe Commercials 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 Globe Commercials Ltd undervalued or overvalued?
Globe Commercials 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 1.81 4.43
Price to Book 0.62 1.02
Price to Sales 0.07 0.11
EV to EBITDA 1.39 3.59
Q.4 Is Globe Commercials Ltd a good buy now?
Globe Commercials 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.

Q.1 Gross Profit margin of Globe Commercials Ltd?
Globe Commercials Ltd Gross profit margin which is the profit after deduction of direct costs, is 4.2% for FY-2025, which is above its 5-year median of 2.3%, indicating increasing margins.

Q.2 Operating Profit Margin of Globe Commercials Ltd?
Globe Commercials Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 4.17% for FY-2025, which is above its 5-year median of 2.3% indicating increasing margins.

Q.3 Net Profit Margin of Globe Commercials Ltd?
Globe Commercials Ltd Net Profit Margin is 2.95% for FY-2025, is above its 5-year median of 1.7%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 4.2 2.3
Operating Profit Margin (%) 4.17 2.3
Net Profit Margin (%) 2.95 1.7

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Globe Commercials Ltd?
Globe Commercials Ltd Return on Asset is 10.43%, which is above its 5-year historical median of 5.35%, indicating improved asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Globe Commercials Ltd?
Globe Commercials Ltd Return on capital employed is 49.96% for FY-2025, which is above its 5-year historical median of 33.48%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.6 Return on Equity (ROE) of Globe Commercials Ltd?
Globe Commercials Ltd Return on equity is 38.76% for FY-2025, which is above its 5-year historical median of 27.83%, indicating the business is making better use of its shareholders capital.

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

Q.7 Debt to Equity ratio of Globe Commercials Ltd?
Globe Commercials Ltd Debt-to-Equity ratio is 0.08, which is above the industry average of 0.03, indicating higher debt levels in the industry.

Q.8 Debt to cash flow from operations of Globe Commercials Ltd?
Globe Commercials Ltd Debt to cash flow from operations is 62.94, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Globe Commercials Ltd?

Q.1 Promoter shareholding and pledge status of Globe Commercials Ltd?
Promoters hold 8.33% of the Globe Commercials Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Globe Commercials Ltd vs industry peers?
Globe Commercials Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 0%, indicating stable growth and maintaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) - -
Gross Profit Growth (%) 102.9 17.9
Operating Profit Growth (%) 104.8 16.4
Net Profit Growth (%) 97.1 17.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 3.53 0.52
ROE (%) 38.76 2.05
ROCE (%) 49.96 3.6
Cash Conversion Cycle (days) 19.91 46

Valuation & price assessment

Q.1 Stock return of Globe Commercials Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 33.3% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- 33.3% -7.4% -12.6%
Q.2 Valuation ratios of Globe Commercials Ltd vs historical?
The current P/E ratio of 1.81 is lower than its historical median of 4.43, 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 1.81 4.43 33.62
Price to Book 0.62 1.02 1.57
Price to Sales 0.07 0.11 2.21
EV to EBITDA 1.39 3.59 14.09

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