🧠 At a Glance
On June 3, 2025, Shubhshree biofuels Ltd informed the exchange that it has received an order worth ₹1.33 crore from a reputed customer.
Product: TMT bars (500D grade)
Customer: Undisclosed
Timeline: Immediate dispatch
But the twist?
- 💸 Market cap = ₹700 crore
- 📉 Stock has been rising in circuits lately
- 🔍 Order value = 0.19% of annual revenue
That’s like announcing “I found ₹10 in my jeans” when you owe ₹5 lakh on your credit card.
🏭 What Does the Company Do?
Shubhshree biofuels is in the iron & steel manufacturing game:
- Makes TMT bars, MS angles, channels, billets
- Operates in Jharkhand/Bihar/Odisha belt
- Supplies to infrastructure, construction, and real estate
It’s one of those new SME listings where:
- Volume is low
- Promoters hold tight
- And operator activity smells strong
📉 Financial Snapshot (FY24)
| Metric | Value |
|---|---|
| Revenue (Est.) | ₹700 crore |
| PAT | ₹8.9 crore |
| EBITDA Margin | ~4.5% |
| Net Margin | ~1.3% |
| Debt | High, ~₹120 cr |
| Market Cap | ₹700 crore+ |
You read that right — the company trades at 80x earnings, with single-digit RoE and slim margins.
That’s not valuation. That’s delusion.
🧠 EduInvesting Take
“A ₹1.3 crore order in a ₹700 crore company is like giving someone a Bournvita when they need blood transfusion.”
Let’s break this:
- The company earns ₹700 crore+ annually
- Gets ₹1.3 crore order — i.e., half a day’s business
- Still issues an exchange notification + PR
Why? Probably because:
- Stock has been rising fast
- Any news is used to trigger another upper circuit
The real question:
“Why announce such a tiny order unless you’re feeding the rally?”
🧨 Red Flags
- ❌ Undisclosed client — always suspicious
- ❌ No margin or profitability on this order shared
- ❌ Frequent PRs for small orders
- ❌ SME with extreme valuation disconnect
📉 Chart Behavior (Smells Like Pump)
Recent price moves show:
- 10–12% daily spikes
- Low volume, high delivery percentage
- Classic signs of operator zones
Yet, fundamentals remain unchanged.
🧮 Fair Value Estimate (Harsh but Fair)
Let’s give it the benefit of doubt:
FY26E EPS = ₹3.5
Assign SME multiple = 18–20x
🎯 FV Range = ₹63–₹70
CMP: Around ₹130+ (post recent rally)
Downside risk? Easily 40–50% if circuits reverse.
🧾 TL;DR
| 📦 What Happened | 🧠 What It Means |
|---|---|
| ₹1.3 Cr order | Looks good, but too small |
| Disclosure + Hype | Likely part of price game |
| Edu Verdict | If it walks like a pump & talks like a pump… |
Until the company shows:
- Better margins
- Real client disclosures
- Debt reduction
…it’s just TMT theatre on SME stage.
Author: Prashant Marathe
Date: June 4, 2025
Tags: Shubhshree biofuels, SME order, TMT bars, pump and dump, smallcap steel stocks, stock operator alert, fake rallies India
