At a Glance
Kriti Industries manufactures PVC and HDPE pipes, fittings, and telecom ducts. It once had decent margins and growth, but FY24–25 was a total washout: flat sales, net losses, and negative ROE. Throw in a questionable auto division merger and warrants galore, and you’ve got a turnaround story… or a slow leak.
1. Introduction with Hook 🧯
The great Indian pipe dream isn’t just Bollywood. It’s irrigation, it’s smart cities, it’s Jal Jeevan. It’s plastic pipes with 20% margin.
Well… unless you’re Kriti Industries, where operating margin is 4% and net profit is -₹4 Cr.
Is this a smallcap value play post-pain? Or a classic case of “Dekho sir, price-to-book is misleading”?
Let’s dig into this pipe maker’s cracked financial plumbing.
2. WTF Do They Even Do? 🧩
Core Business:
- Manufactures PVC & HDPE pipes, fittings, telecom ducts, casing pipes
- Focused on irrigation, construction, gas utilities, and agri
- 33 extrusion lines for PVC
- 14 for HDPE and drip irrigation
- 27 injection moulding machines
👀 In 2024, they announced a merger with Kriti Auto & Engineering Plastics — cross-selling or cross-burdening?
3. Financials Overview – Profit, Margins, ROE 💸
Metric | FY21 | FY23 | FY25 |
---|---|---|---|
Revenue (₹ Cr) | 589 | 732 | 722 |
Net Profit (₹ Cr) | 36 | -23 | -4 |
OPM (%) | 11% | -1% | 4% |
ROE (%) | 7.3% | -4.6% | -2.4% |
📉 FY23 was a bloodbath with negative margins
📉 FY25 net loss = back in the red
📉 ROE and ROCE both below 7%
This pipe’s leaking — and not just water.
4. Valuation – Is It Cheap, Meh, or Crack? 🧠
- CMP: ₹171
- EPS (TTM): -₹0.84
- Book Value: ₹39.5
- P/E: NA
- P/BV: 4.33x 🤯
🎯 Fair Value Range: ₹80–₹100
Based on 20–25x normalized EPS of ₹3–₹4 (if and when recovery happens)
The market’s pricing in a turnaround story, but the results say “not yet, bro.”
5. What’s Cooking – News, Triggers, Drama 🍿
🧱 Merger with Kriti Auto approved (May 2024)
📦 Warrants issued — 94.6 lakh in July 2024
🤝 Allotment of 15 lakh shares to Kriti Nutrients
📉 3 of last 5 quarters had negative EPS
🧃 Telecom duct and infra demand stagnant
Pipe growth is not flowing smoothly.
6. Balance Sheet – How Much Debt, How Many Dreams? 💥
Metric | FY21 | FY23 | FY25 |
---|---|---|---|
Net Worth | ₹134 Cr | ₹130 Cr | ₹202 Cr |
Borrowings | ₹81 Cr | ₹120 Cr | ₹100 Cr |
Total Assets | ₹365 Cr | ₹411 Cr | ₹472 Cr |
- Debt reduced in FY25, but equity diluted
- Net worth growth mostly from warrants, not profits
- Fixed assets rising, but no RoCE payoff yet
7. Cash Flow – Sab Number Game Hai 💵
FY | CFO (₹ Cr) | Capex (₹ Cr) | Net Cash |
---|---|---|---|
FY23 | ₹27 Cr | ₹31 Cr | ~0 |
FY24 | ₹58 Cr | ₹46 Cr | ~0 |
FY25 | ₹34 Cr | ₹37 Cr | ~0 |
Stable operational cash flow. But zero free cash flow.
Basically, every rupee earned is drilled into a new pipe machine.
8. Ratios – Sexy or Stressy? 📉
Ratio | FY23 | FY24 | FY25 |
---|---|---|---|
ROCE | -6% | 19% | 6% |
ROE | -4.6% | 4.4% | -2.4% |
OPM | -1% | 7% | 4% |
CCC (Days) | 44 | 40 | 44 |
⚠️ ROE and OPM trending wrong direction
✅ Working capital cycle under control
❌ ROCE dip post-merger incoming?
9. P&L Breakdown – Show Me the Money 💰
FY | Revenue (₹ Cr) | EBITDA (₹ Cr) | PAT (₹ Cr) |
---|---|---|---|
FY22 | 545 | ₹39 Cr | ₹20 Cr |
FY23 | 732 | ₹-8 Cr | ₹-23 Cr |
FY25 | 722 | ₹28 Cr | ₹-4 Cr |
Peak profit was in FY21–22, then a brutal FY23 wiped it out.
FY25 was an improvement — but not convincing.
10. Peer Comparison – Who Else in the Game? 🚿
Company | P/E | ROE (%) | OPM (%) | M.Cap (₹ Cr) |
---|---|---|---|---|
Astral | 77x | 15.3% | 16.2% | ₹40,000+ |
Finolex Inds | 28x | 7.9% | 11.5% | ₹12,600 |
Time Techno | 26x | 14.2% | 14.4% | ₹10,100 |
Kriti Inds | NA | -2.4% | 4.0% | ₹883 |
📉 Kriti is a microcap among giants
📉 Trading at 4.3x book with negative ROE is absurd
11. Miscellaneous – Shareholding, Warrants, Corporate Drama 🚩
Holder | Mar ’24 | Jun ’25 |
---|---|---|
Promoters | 66.35% | 68.72% |
FIIs | 0.08% | 0.11% |
Public | 32.18% | 31.17% |
- ✅ Promoter stake inching up
- ⚠️ Massive warrant issuance dilutes future EPS
- 📍 Shareholders: ~12,000 = not operator-driven, but not very institutional either
12. EduInvesting Verdict™ ⚖️
✅ Decent brand in pipes, strong legacy
✅ Merger may add synergy, if managed well
✅ Promoters increasing stake = confidence?
❌ Multiple loss-making quarters
❌ High P/BV for a business in decline
❌ ROE/ROCE = unimpressive, warrant dilution risk high
📉 Fair Value Range: ₹80–₹100
📍 CMP: ₹171 = double the story, half the performance
Verdict: Kriti is like a leaky tap — there’s potential, but right now it’s wasting value, not creating it.
✍️ Written by Prashant | 📅 July 9, 2025
Tags: Kriti Industries, PVC Pipes, Smallcap Pipes, Merger Watch, Preferential Warrants, Irrigation Stocks, EduInvesting Plastics Series