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INVESTMENT INSIGHTS

Check Before You Invest : Rainbow Foundations Ltd

BSE: 531694 NSE: ISIN: INE230F01014
  |   Sector:  Construction & Infrastructure   |   Industry:  Construction - Real Estate

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 quality company, based on a 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 43.3% , indicating faster growth.
Q.2 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 3.8% , indicating increasing margins.
Q.3 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 above its 5 year median of 11.38% indicating increasing margins.
Q.4 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 0.83%, indicating increasing margins.
Q.5 Return on Asset of Rainbow Foundations Ltd?
Rainbow Foundations Ltd Return on Asset is 1.18(x), which is above its 5 year historical median of 0.09(x), indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Rainbow Foundations Ltd?
Rainbow Foundations Ltd Return on equity is 10.51% for FY-2025 , which is above its historical median of 1.58%, indicating the business is making better use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Rainbow Foundations Ltd?
Rainbow Foundations Ltd Return on capital employed is 6.64% for FY-2025 , which is below its estimated weighted average cost of capital(WACC) 14%, indicating value preservation .
Q.8 Cash conversion cycle of Rainbow Foundations Ltd?
Rainbow Foundations Ltd Cash conversion cycle is 1312 , below its historical median of 2037 , indicating improved working capital management. However, you need to compare this with its peers in the industry.
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 , 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, indicating the business is not able to service its debt comfortably.

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 7.58% , indicating faster growth and gaining its market share.

Valuation & price assessment

Q.1 Stock return of Rainbow Foundations Ltd over the last decade?
Over the last 9 years, the stock has delivered a CAGR of 20.6% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 20.6% 67.9% 70.3% 28%
Q.3 Valuation ratios of Rainbow Foundations Ltd vs historical?
The current P/E is higher that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 33.71 0.00 40.36
Price to Book 2.92 0.78 1.49
Price to Sales 1.35 1.36 4.61
EV to EBITDA 17.62 15.25 14.16

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