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Check Before You Invest : Advit Jewels Ltd

BSE: 544803 NSE: RAMBHAJO ISIN: INE1SJO01012
  |   Sector:  Consumer Durables   |   Industry:  Diamond & Jewellery

Snapshot

Q.1 Which industry/sub-sector does Advit Jewels Ltd belong to?
Advit Jewels Ltd belongs to the Consumer Durables sector, operating specifically within the Diamond & Jewellery segment.
Q.2 Is Advit Jewels Ltd a good quality company?
Advit Jewels 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 Advit Jewels Ltd undervalued or overvalued?
Advit Jewels 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 3-year
Historic Median
Price to Earnings 24.45 30.35
Price to Book 2.88 3.00
Price to Sales 5.03 6.16
EV to EBITDA 18.51 22.65
Q.4 Is Advit Jewels Ltd a good buy now?
Advit Jewels 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 Advit Jewels Ltd?
Advit Jewels Ltd Gross profit margin which is the profit after deduction of direct costs, is 25.1% for FY-2025, which is in line with its 3-year median of 26.2%, indicating stable margins.

Q.2 Operating Profit Margin of Advit Jewels Ltd?
Advit Jewels Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 29.76% for FY-2025, which is above its 3-year median of 27.41% indicating increasing margins.

Q.3 Net Profit Margin of Advit Jewels Ltd?
Advit Jewels Ltd Net Profit Margin is 20.3% for FY-2025, is in line with its 3-year median of 21.18%, indicating stable margins.
Current Level 3-year
Historic Median
Gross Profit Margin (%) 25.1 26.2
Operating Profit Margin (%) 29.76 27.41
Net Profit Margin (%) 20.3 21.18

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Advit Jewels Ltd?
Advit Jewels Ltd Return on Asset is 24.41%, which is below its 3-year historical median of 30.62%, indicating deteriorated asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Advit Jewels Ltd?
Advit Jewels Ltd Return on capital employed is 39.43% for FY-2025, which is below its 3-year historical median of 48.68%. 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 Advit Jewels Ltd?
Advit Jewels Ltd Return on equity is 55.79% for FY-2025, which is in line with its 3-year historical median of 57.47%, indicating the business is making similar 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 Advit Jewels Ltd?
Advit Jewels Ltd Debt-to-Equity ratio is 1.29, which is above the industry average of 0.57, indicating higher debt levels in the industry.

Q.8 Debt to cash flow from operations of Advit Jewels Ltd?
Advit Jewels Ltd Debt to cash flow from operations is -2.02, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Advit Jewels Ltd?

Q.1 Promoter shareholding and pledge status of Advit Jewels Ltd?
Promoters hold 69.88% of the Advit Jewels Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Advit Jewels Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Advit Jewels Ltd vs industry peers?
Advit Jewels Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 13.12%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 3-year
Industry Median
Revenue Growth (%) - 13.1
Gross Profit Growth (%) 72.2 29.2
Operating Profit Growth (%) 94.7 31.6
Net Profit Growth (%) 66.7 30.5
Operating Efficiency
Current Level 3-year
Industry Median
Asset Turnover (x) 1.2 1.55
ROE (%) 55.79 9.5
ROCE (%) 39.43 11.33
Cash Conversion Cycle (days) 239.02 133

Valuation & price assessment

Q.1 Stock return of Advit Jewels Ltd over the last decade?
Over the last - year(s), the stock has delivered a CAGR of N/A% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - -
Q.2 Valuation ratios of Advit Jewels Ltd vs historical?
The current P/E ratio of 24.45 is lower than its historical median of 30.35, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 3-year historical median and industry numbers?
Valuation Ratios Current 3-year
Historic Median
3-year
Industry Median
Price to Earnings 24.45 30.35 28.21
Price to Book 2.88 3.00 1.95
Price to Sales 5.03 6.16 1.40
EV to EBITDA 18.51 22.65 17.18

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