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Check Before You Invest : SVC Industries Ltd

BSE: 524488 NSE: ATVPETRO ISIN: INE038B01010
  |   Sector:  Oil & Gas   |   Industry:  Petrochemicals

Snapshot

Q.1 Which industry/sub-sector does SVC Industries Ltd belong to?
SVC Industries Ltd belongs to the Oil & Gas sector, operating specifically within the Petrochemicals segment.
Q.2 Is SVC Industries Ltd a good quality company?
SVC Industries 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 SVC Industries Ltd undervalued or overvalued?
SVC Industries Ltd appears 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 - -
Price to Book 0.17 0.21
Price to Sales 9.08 142.82
EV to EBITDA -299.84 -300.73
Q.4 Is SVC Industries Ltd a good buy now?
SVC Industries 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.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of SVC Industries Ltd?
SVC Industries Ltd revenue growth is 219.5% for FY-2025, which is above its 5-year CAGR of 56.4%, indicating faster growth.

Q.2 Gross Profit margin of SVC Industries Ltd?
SVC Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 26.6% for FY-2025, which is above its 5-year median of -115.9%, indicating increasing margins.

Q.3 Operating Profit Margin of SVC Industries Ltd?
SVC Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is -62.62% for FY-2025, which is above its 5-year median of -155.33% indicating increasing margins.

Q.4 Net Profit Margin of SVC Industries Ltd?
SVC Industries Ltd Net Profit Margin is -120.03% for FY-2025, is above its 5-year median of -609.66%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 26.6 -115.9
Operating Profit Margin (%) -62.62 -155.33
Net Profit Margin (%) -120.03 -609.66

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of SVC Industries Ltd?
SVC Industries Ltd Return on Asset is -0.35%, which is above its 5-year historical median of -0.55%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of SVC Industries Ltd?
SVC Industries Ltd Return on capital employed is -0.35% for FY-2025, which is above its 5-year historical median of -0.56%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of SVC Industries Ltd?
SVC Industries Ltd Return on equity is -0.59% for FY-2025, which is above its 5-year historical median of -0.91%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of SVC Industries Ltd?
SVC Industries Ltd Cash conversion cycle is 25 days, below its 5-year historical median of 120 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 (x) - -
ROE (%) -0.59 -0.91
ROCE (%) -0.35 -0.56
Cash Conversion Cycle 25 days 120 days

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

Q.9 Debt to Equity ratio of SVC Industries Ltd?
SVC Industries Ltd Debt-to-Equity ratio is 0.65, which is above the industry average of 0.46, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of SVC Industries Ltd?
SVC Industries Ltd Debt to cash flow from operations is -117.21, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of SVC Industries Ltd?

Q.1 Promoter shareholding and pledge status of SVC Industries Ltd?
Promoters hold 47.71% of the SVC Industries Ltd, with 2.68% of their stake pledged, indicating low pledge risk.

Peer comparison (industry-wise, mcap)

E: How does SVC Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of SVC Industries Ltd vs industry peers?
SVC Industries Ltd revenue CAGR is 56.40%, compared to the industry median CAGR of 9.22%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 219.5 9.2
Gross Profit Growth (%) 0 5.3
Operating Profit Growth (%) 0 10.7
Net Profit Growth (%) 0 6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) - 1.3
ROE (%) -0.59 10.1
ROCE (%) -0.35 13.45
Cash Conversion Cycle (days) 24.75 41

Valuation & price assessment

Q.1 Stock return of SVC Industries Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 15.9% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
15.9% 23% -1.8% -17.6%
Q.2 Valuation ratios of SVC Industries Ltd vs historical?
The current P/E ratio of 0 is in line with than its historical median of , indicating that the stock is trading near 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 - - 14.30
Price to Book 0.17 0.21 2.05
Price to Sales 9.08 142.82 1.35
EV to EBITDA -299.84 -300.73 9.88

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