Check Before You Invest : Rainbow Foundations Ltd

Snapshot

Q.1 Which industry/sub-sector does Rainbow Foundations Ltd belong to?

Rainbow Foundations Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Construction - Real Estate segment.

Q.2 Is Rainbow Foundations Ltd a good quality company?

Rainbow Foundations Ltd is a weak quality company, based on a inconsistent 10-year financial track record.

Q.3 Is Rainbow Foundations Ltd undervalued or overvalued?

Rainbow Foundations Ltd appears Somewhat Undervalued, as its key valuation ratios are below with their past averages.

Q.4 Is Rainbow Foundations Ltd a good buy now?

Rainbow Foundations 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

Q.1 Revenue growth of Rainbow Foundations Ltd?

Rainbow Foundations Ltd revenue growth is 67% for FY-2025, which is above its 5-year CAGR of 43.29%, indicating faster growth.

Q.2 Return on capital employed (ROCE) of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Return on capital employed is 6.64% for FY-2025, which is above its 5-year historical median of 4.69%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.3 Return on Asset of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Return on Asset is 1.18%, which is above its 5-year historical median of 0.39%, indicating improved asset utilization efficiency.

Q.4 Return on Equity (ROE) of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Return on equity is 10.51% for FY-2025, which is above its 5-year historical median of 4.52%, indicating the business is making better use of its shareholders capital.

Q.5 Cash conversion cycle of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Cash conversion cycle is 1312 days, below its 5-year historical median of 1919 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	0.23	0.12
ROE	10.51	4.52
ROCE	6.64	4.69
Cash Conversion Cycle	1312 days	1919 days

Q.6 Gross Profit margin of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Gross profit margin which is the profit after deduction of direct costs, is 7.3% for FY-2025, which is above its 5-year median of 4.9%, indicating increasing margins.

Q.7 Operating Profit Margin of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.31% for FY-2025, which is in line with its 5-year median of 24.97% indicating stable margins.

Q.8 Net Profit Margin of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Net Profit Margin is 5.13% for FY-2025, is above with its 5-year median of 3.36%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	7.3	4.9
Operating Profit Margin	25.31	24.97
Net Profit Margin	5.13	3.36

Q.9 Debt to Equity ratio of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Debt-to-Equity ratio is 7.27, which is above with the industry average of 0.31, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Rainbow Foundations Ltd?

Rainbow Foundations Ltd Debt to cash flow from operations is -7.25, which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Rainbow Foundations Ltd?

Promoters hold 41.48% of the Rainbow Foundations Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Rainbow Foundations Ltd vs industry peers?

Rainbow Foundations Ltd revenue CAGR is 43.29%, compared to the industry median CAGR of 4.37%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	67	4.4
Gross Profit Growth	120	NAN
Operating Profit Growth	73.9	NAN
Net Profit Growth	166.7	NAN

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	0.23	0.14
ROE	10.51	1.52
ROCE	6.64	4.04
Cash Conversion Cycle (days)	1311.96	625

Valuation & price assessment

Q.1 Stock return of Rainbow Foundations Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 20.9% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	20.9%	60.8%	67.4%	-0.2%

Q.3 Valuation ratios of Rainbow Foundations Ltd vs historical?

The current P/E is lower that its historical median.

Q.4 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	32.29	34.90	34.05
Price to Book	2.79	0.96	1.53
Price to Sales	1.29	1.29	5.34
EV to EBITDA	17.4	18.07	14.40

Check more companies

1. Brigade Enterprises

2. Anant Raj

3. Aditya Birla Real

4. Sobha

5. Signatureglobal Ind.

6. Dilip Buildcon

7. Mahindra Life. Dev

8. Sri Lotus Developers

9. Embassy Developments

10. Valor Estate

Check trending companies

1. Indraprastha Gas Ltd.

2. Oracle Financial Services Software Ltd.

3. Dr. Lal Pathlabs Ltd.

4. Vedant Fashions Ltd.

5. Alkyl Amines Chemicals Ltd.