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INVESTMENT INSIGHTS

Check Before You Invest : Redtape Ltd

BSE: 543957 NSE: REDTAPE ISIN: INE0LXT01019
  |   Sector:  Retail   |   Industry:  Retailing

Snapshot

Q.1 Which industry/sub-sector does Redtape Ltd belong to?
Redtape Ltd belongs to the Retail sector, operating specifically within the Retailing segment.
Q.2 Is Redtape Ltd a good quality company?
Redtape Ltd is a weak quality company, based on a inconsistent 10 year financial track record.
Q.3 Is Redtape Ltd undervalued or overvalued?
Redtape Ltd appears Undervalued, as its key valuation ratios are below with their past averages.
Q.4 Is Redtape Ltd a good buy now?
Redtape 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

Q.1 Revenue growth of Redtape Ltd?
Redtape Ltd revenue growth is 10.2% for FY-2025 , which is above its 5 year CAGR of 0% , indicating faster growth.
Q.2 Gross Profit margin of Redtape Ltd?
Redtape Ltd Gross profit margin which is the profit after deduction of direct costs, is 16.4% for FY-2025 , which is above its 5 year median of 15.95% , indicating increasing margins.
Q.3 Operating Profit Margin of Redtape Ltd?
Redtape Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 16.8% for FY-2025 , which is above its 5 year median of 16.6% indicating increasing margins.
Q.4 Net Profit Margin of Redtape Ltd?
Redtape Ltd Net Profit Margin is 9.14% for FY-2025 , is below with its 5 year median of 9.24%, indicating decreasing margins.
Current Level Historic Median
Gross Profit Margin 16.4 15.95
Operating Profit Margin 16.8 16.6
Net Profit Margin 9.14 9.24
Q.5 Return on Asset of Redtape Ltd?
Redtape Ltd Return on Asset is 9.44%, which is below its 5 year historical median of 15.82%, indicating deteriorated asset utilization efficiency.
Q.6 Return on Equity (ROE) of Redtape Ltd?
Redtape Ltd Return on equity is 25.98% for FY-2025 , which is below its historical median of 42.18%, indicating the business is making worse use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Redtape Ltd?
Redtape Ltd Return on capital employed is 30.97% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 13.5%, indicating value creation.
Q.8 Cash conversion cycle of Redtape Ltd?
Redtape Ltd Cash conversion cycle is 132 days, above its historical median of 91 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 1.03 1.71
ROE 25.98 42.18
ROCE 30.97 51.8
Cash Conversion Cycle 132 days 91 days
Q.9 Debt to Equity ratio of Redtape Ltd?
Redtape Ltd Debt-to-Equity ratio is 0.46 , which is above with the industry average of 0.3 , indicating higher debt levels in the industry.
Q.10 Debt to cash flow from operations of Redtape Ltd?
Redtape Ltd Debt to cash flow from operations is -122.38 , which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Redtape Ltd?
Promoters hold 71.83% of the Redtape Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Redtape Ltd vs industry peers?
Redtape Ltd revenue CAGR is 0.00% , compared to the industry median CAGR of 0% , indicating slower growth and losing its market share.
Profit Metrics
Current Level Industry Median
Revenue 2,018.5 249.2
Gross Profit 331 5.2
Operating Profit 339 6
Net Profit 184 1.6
Operating Efficiency
Current Level Industry Median
Asset Turnover 1.03 1.11
ROE 25.98 3.58
ROCE 30.97 11.9
Cash Conversion Cycle (days) 132 38

Valuation & price assessment

Q.1 Stock return of Redtape Ltd over the last decade?
Over the last 1 year(s), the stock has delivered a CAGR of -14.9% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price - - - -14.9%
Q.3 Valuation ratios of Redtape Ltd vs historical?
The current P/E is lower 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 29.71 65.39 69.86
Price to Book 7 15.28 3.21
Price to Sales 3.01 5.38 1.29
EV to EBITDA 16.05 33.06 13.01

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