At a Glance:
Goyal Salt refines raw sub-soil brine into high-quality edible and industrial salt — no Shilpa Shetty ads, just hardcore sodium chloride hustle. Profits are growing faster than their CWIP, and with 29% ROCE, this SME is giving largecaps hypertension.
🧪 1. What They Actually Do – Salt, But Fancy
- 🌊 Extracts and refines brine-based salt from Rajasthan’s sub-soil
- 🧂 Offers:
- Triple refined iodized salt
- Double fortified salt
- Industrial & half-dry salt
- 🏭 Targets B2B + wholesale supply chains (no retail FMCG yet)
- Uses integrated processing (evaporation + refining + drying + crushing)
📦 Not your kitchen salt. Think of it as Tata Chemicals’ little cousin in Jodhpur with ambition.
💸 2. Financials – Salt That Actually Prints Money
| FY | Revenue (₹ Cr) | Net Profit (₹ Cr) | OPM | ROCE | ROE |
|---|---|---|---|---|---|
| FY21 | ₹60 | ₹1 | 5% | 9% | 5% |
| FY23 | ₹117 | ₹4 | 6% | 25% | 23% |
| FY24 | ₹118 | ₹9 | 6% | 18% | 27% |
| FY25 | ₹130 | ₹13 | 9% | 29% | 27% |
- 5Y Profit CAGR: 121% 🧨
- EPS FY25: ₹7.40
- Operating Margins: Rising with scale
- Stock Price (1Y): Down 14% despite solid performance
🧮 3. Valuation – Not Too Salty, But Not Cheap Either
- CMP: ₹156
- EPS (TTM): ₹7.40
- P/E: 21.1x
- Book Value: ₹31 → P/BV: 5.05x
- Market Cap: ₹280 Cr
🎯 Fair Value Range:
| Scenario | EPS FY26E | P/E | FV |
|---|---|---|---|
| 🧂 Base | ₹8.5 | 18x | ₹153 |
| 😬 Conservative | ₹9 | 20x | ₹180 |
| 🚀 Bullish | ₹10 | 25x | ₹250 |
🎯 FV Range: ₹153 – ₹250
(CMP ₹156 = fair zone if growth sustains. Not a deep discount, not hyped.)
🧾 4. Balance Sheet – CWIP Boom Incoming?
- Total Assets: ₹81 Cr
- CWIP up from ₹4 Cr → ₹29 Cr = Expansion brewing ⚗️
- Net worth: ₹56 Cr
- Borrowings: ₹21 Cr (manageable)
- Other Income in FY25 = ₹7.4 Cr (watch this – recurring or one-off?)
🛠️ Capex-led growth is good. But we need to see if that CWIP becomes revenue, or just cement and sweat.
🔁 5. Working Capital Cycle – Slightly Sweaty
| Metric | FY24 | FY25 |
|---|---|---|
| Debtor Days | 58 → 43 ✅ | |
| Inventory Days | 21 → 52 ❌ | |
| Payable Days | 9 → 10 | |
| Cash Conversion Cycle | 70 → 85 |
🧻 Inventory build-up ahead of scale-up? If FY26 doesn’t show revenue jump, it’ll start smelling… stale.
📉 6. Red Flags – Fine-Grain Warnings
- ❌ No dividend payout despite ₹13 Cr profit
- ❌ Resignation of Company Secretary (May 2025) — no red alert, but worth tracking
- ❌ Capitalizing interest costs? Screener flag = look deeper in AR
- ❌ Other income = ₹7 Cr (over 50% of FY25 PBT!) 🧐
If salt profits come from non-salt activities, SEBI might not like it. And neither will investors.
📈 7. Shareholding Pattern – Rock Solid… For Now
| Entity | Mar 2025 |
|---|---|
| Promoters | 72.61% |
| FIIs | 0.46% |
| DIIs | 0.49% |
| Public | 26.44% |
| No. of Shareholders | 1,359 (↑ from 675 in FY24) |
🧠 No dilution. No pledging. But small FII/DII stake + SME listing = low liquidity = high swings
🏁 Verdict – SME Salt with Industrial Ambition
Goyal Salt is quietly scaling up in India’s most basic-but-essential commodity, with clean books, strong ROE, and capex firepower. But some steam might be from other income — watch that closely.
✅ Pros:
- High ROCE/ROE
- CWIP = growth ahead
- Debt under control
- Salt demand = evergreen
❌ Cons:
- Other income dependency
- CWIP yet to convert
- Inventory up
- No dividends despite profits
🏷️ Tags:
Goyal Salt, SME Stocks India, Salt Manufacturer, Industrial Salt, Rajasthan Brine Extraction, Fair Value Analysis, EduInvesting, Sodium Chloride Stock
✍️ Written by Prashant | 📅 June 26, 2025
