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Check Before You Invest : Vapi Enterprise Ltd

BSE: 502589 NSE: ISIN: INE464D01014
  |   Sector:  Paper & Stationary   |   Industry:  Paper & Paper Products

Snapshot

Q.1 Which industry/sub-sector does Vapi Enterprise Ltd belong to?
Vapi Enterprise Ltd belongs to the Paper & Stationary sector, operating specifically within the Paper & Paper Products segment.
Q.2 Is Vapi Enterprise Ltd a good quality company?
Vapi Enterprise 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 Vapi Enterprise Ltd undervalued or overvalued?
Vapi Enterprise 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 5-year
Historic Median
Price to Earnings 15.26 22.84
Price to Book 0.6 0.66
Price to Sales - 3.19
EV to EBITDA -6.34 2.87
Q.4 Is Vapi Enterprise Ltd a good buy now?
Vapi Enterprise 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 Vapi Enterprise Ltd?
Vapi Enterprise Ltd revenue growth is 0% for FY-2025, which is above its 5-year CAGR of -100%, indicating faster growth.

Q.2 Gross Profit margin of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Gross profit margin which is the profit after deduction of direct costs, is 104% for FY-2025, which is above its 5-year median of 30.4%, indicating increasing margins.

Q.3 Operating Profit Margin of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 0% for FY-2025, which is above its 5-year median of -17.77% indicating increasing margins.

Q.4 Net Profit Margin of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Net Profit Margin is -% for FY-2025, is below its 5-year median of 17.88%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 104 30.4
Operating Profit Margin (%) - -17.77
Net Profit Margin (%) - 17.88

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Return on Asset is 3.65%, which is in line with its 5-year historical median of 3.65%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Return on capital employed is 4.94% for FY-2025, which is below its 5-year historical median of 16.58%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

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

Q.7 Debt to Equity ratio of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Debt-to-Equity ratio is 0.01, which is lower the industry average of 0.48, indicating lower debt levels in the industry.

Q.8 Debt to cash flow from operations of Vapi Enterprise Ltd?
Vapi Enterprise Ltd Debt to cash flow from operations is -0.46, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Vapi Enterprise Ltd?

Q.1 Promoter shareholding and pledge status of Vapi Enterprise Ltd?
Promoters hold 38.35% of the Vapi Enterprise Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Vapi Enterprise Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Vapi Enterprise Ltd vs industry peers?
Vapi Enterprise Ltd revenue CAGR is -100.00%, compared to the industry median CAGR of 5.29%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) - 5.3
Gross Profit Growth (%) 24.7 3.9
Operating Profit Growth (%) 0 0.8
Net Profit Growth (%) 59 1.4
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) - 0.91
ROE (%) - 4.81
ROCE (%) 4.94 7.06
Cash Conversion Cycle (days) - 47

Valuation & price assessment

Q.1 Stock return of Vapi Enterprise Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 25.9% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
25.9% 45.2% 1.6% -27.2%
Q.2 Valuation ratios of Vapi Enterprise Ltd vs historical?
The current P/E ratio of 15.26 is lower than its historical median of 22.84, indicating that the stock is trading below 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 15.26 22.84 11.02
Price to Book 0.6 0.66 0.91
Price to Sales - 3.19 0.72
EV to EBITDA -6.34 2.87 6.12

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