🧠 At a Glance
CDG Petchem sounds like a petrochemical company. It’s not. It’s a microcap trader of literally anything that’s plastic, chemical, or soft enough to nap on. With just ₹5 Cr in revenue, ₹16 Cr market cap, and -331% ROE, this one’s less “emerging market” and more “vanishing act.”
🚨 1. The Red Flags are Practically Neon
| Metric | Status |
|---|---|
| Revenue FY25 | ₹23.1 Cr |
| Net Profit FY25 | ₹-1.16 Cr |
| Book Value/Share | ₹-0.71 📉 |
| ROE (3-Year Avg) | -57% 🚨 |
| Promoter Holding | 20.7% 🔻 (down 41%) |
| Operating Margin | -1.86% |
| Debt | ₹5.76 Cr |
💣 The company literally has negative net worth. Book value is negative. Let that sink in.
🧾 2. Product Chaos, Strategic Confusion
Their website and filings claim involvement in:
- 🛏️ Mattresses & Pillows
- 🛠️ Construction Chemicals
- 📦 Packaging Films
- 🧪 Pharma Chemicals
- 🧬 Surfactants
- 🌫️ Fumed Silica
- 🔌 Insulation Sheets
- 🤷 “Technical Fabrics” – whatever that means
This is not a diversified business. This is a bazaar.
🪫 3. Financial Performance: Shrinking Like Plastic in Fire
| Year | Revenue (₹ Cr) | Net Profit (₹ Cr) | EPS (₹) | ROCE (%) |
|---|---|---|---|---|
| FY21 | ₹39.4 | ₹-0.15 | -0.49 | 7.8 |
| FY22 | ₹53.4 | ₹-2.32 | -7.54 | -2.7 |
| FY23 | ₹50.8 | ₹-0.38 | -1.3 | 5.6 |
| FY24 | ₹40.5 | ₹-0.56 | -2.4 | 4.8 |
| FY25 | ₹23.1 | ₹-1.16 | -3.61 | -4.3 |
📉 5-year revenue CAGR = -24%
📉 Profitability? MIA.
📉 TTM sales down 43%
Even “sleeping on a mattress” would outperform this stock.
💔 4. Balance Sheet: Shaky Foundations
- Negative Reserves: ₹-3.30 Cr
- High Debtor Days: 115 = cash stuck
- Debt still present despite low operations
- Net worth negative → red alert for auditors
🧮 Net Asset Value per share: Negative
If this were a startup pitch, the investor would’ve ghosted.
👨👩👧👦 5. Promoter Drama
- Promoter holding fell from 62.1% to 20.7%
- No institutional interest
- Public holding now 78.6% – basically a free float casino
🚨 Classic signs of “dumping the bag” on retail.
📉 6. Quarterly Performance: It Gets Worse
| Quarter | Sales (₹ Cr) | Net Profit (₹ Cr) | EPS (₹) |
|---|---|---|---|
| Mar 2024 | ₹7.33 | ₹-0.24 | -1.36 |
| Jun 2024 | ₹6.36 | ₹-0.41 | -1.33 |
| Sep 2024 | ₹6.04 | ₹-0.29 | -0.97 |
| Dec 2024 | ₹5.45 | ₹-0.06 | -0.19 |
| Mar 2025 | ₹5.25 | ₹-0.32 | -0.91 |
→ 5 consecutive quarters of declining revenue and losses
→ EPS consistently negative, suggesting no turnaround in sight
🎯 7. Fair Value? You Sure You Wanna Know?
Let’s be generous and pretend this company somehow earns ₹1 Cr profit.
- Industry PE (low-end): 20x
- Even at ₹1 Cr PAT, max valuation = ₹20 Cr
- Shares Outstanding = ~30.8 lakh
- FV = ₹65 max — only in fantasyland
- Realistic FV based on -₹3.30 Cr equity?
💣 Zero or even negative.
📍CMP = ₹52.60
🎯 Realistic FV = ₹0 – ₹10 (only if miraculous turnaround + promoter buyback)
🔍 EduInvesting Take
CDG Petchem isn’t a petchem company.
It’s a zombie SME with:
- No profits
- Shrinking revenues
- Promoter exit
- Negative book value
- Random business lines
Yet it’s up 70% in 1 year. Welcome to the penny stock casino.
Unless you’re playing musical chairs in a pump-and-dump, this script should be studied.
✍️ Written by Prashant | 📅 26 June 2025
Tags: CDG Petchem, penny stock India, SME stocks, red flag companies, promoter dump, pump and dump, negative book value, avoid list
