At a Glance
Dhoot Industrial Finance (DIFL), the mini-conglomerate trading in everything from caustic soda to wind energy, delivered Q1 FY26 PAT ₹13.5 Cr on a meagre sales of ₹2 Cr. Yes, you read that right – sales are tiny, profits are huge, courtesy of a ₹29 Cr other income. Stock jumped 5% to ₹284, still trading at 0.4x its massive ₹712 BV. The real kicker? Market value of investments ₹488 Cr > Market Cap ₹180 Cr – classic asset play!
Introduction
Imagine a company that sells chemicals but earns like an investment fund. That’s Dhoot Industrial Finance. Operations? Barely breathing. Investments? Carrying the company like a bodyguard. With a P/E of 5.5, the market thinks this is a value trap, but with hidden assets, it could also be a treasure chest waiting for Indiana Jones.
Business Model (WTF Do They Even Do?)
- Segments:
a) Trading (chemicals, electronics, paper, commodities)
b) Power generation (wind mills)
c) Investments (the real moneymaker) - Roast: Their chemical list reads like a chemistry exam, but profits come from stock investments.
Financials Overview
Q1 FY26
- Revenue: ₹2 Cr (flat, yawn)
- EBIT: ₹-2 Cr (loss on core ops)
- Other Income: ₹29 Cr (👏 the savior)
- PAT: ₹13.5 Cr (EPS ₹21.35)
FY25 Snapshot
- Revenue: ₹11 Cr
- PAT: ₹32 Cr
- ROE: 4.3%
Comment: Core ops dying, investments rocking.
Valuation
- P/E Method – EPS FY25 ₹29.9; P/E 5x → FV ₹150
- Book Value Method – BV ₹712; conservative P/B 0.5x → FV ₹356
- Sum of Parts – Investments ₹488 Cr / shares ≈ ₹770 FV
🎯 Fair Value Range: ₹350 – ₹450
CMP ₹284 = undervalued (on asset basis).
What’s Cooking – News, Triggers, Drama
- Record Date: Sept 18 for final dividend (₹1.5).
- Investments: ₹488 Cr, mostly marketable.
- Trigger: Unlocking investment value could rerate stock.
- Drama: Operating business remains a loss machine.
Balance Sheet
| (₹ Cr) | Mar 2025 |
|---|---|
| Assets | 523 |
| Liabilities | 73 |
| Net Worth | 449 |
| Borrowings | 57 |
Remark: Strong assets, minimal debt.
Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating | 9 | -56 | -15 |
| Investing | -4 | 62 | 20 |
| Financing | -5 | -5 | -6 |
Remark: Ops cash flows negative, investing drives numbers.
Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 4.3% |
| ROCE | 4.3% |
| P/E | 5.5x |
| PAT Margin | absurd (due to other income) |
| D/E | 0.13 |
Remark: Sexy assets, stressy operations.
P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 35 | 33 | 11 |
| EBITDA | -3 | -5 | -26 |
| PAT | 10 | 19 | 32 |
Remark: PAT depends entirely on other income.
Peer Comparison
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Redington | 1,04,000 | 1,219 | 17x |
| MSTC | 311 | 197 | 17x |
| Dhoot Industrial Fin | 14 | 32 | 5x |
Remark: DIFL looks dirt cheap but peers have actual businesses.
Miscellaneous – Shareholding, Promoters
- Promoters: 69.07% (stable)
- DIIs: 0.02%
- Public: 30.9%
Observation: Strong promoter hold, no FIIs.
EduInvesting Verdict™
Dhoot Industrial Finance is an asset-rich, business-poor stock. The value of its investments far exceeds its market cap, making it a potential value unlock story. However, core business is almost non-existent, and without a catalyst (stake sale, buyback, investment monetization), the stock may just sit undervalued.
SWOT Quickie
- Strengths: Huge investments, low debt, cheap valuation.
- Weaknesses: Core business loss-making, poor ROE.
- Opportunities: Unlock value via asset monetization.
- Threats: Investment volatility, lack of growth.
Final Word: For deep value hunters, this is a sleeper. For growth seekers, avoid unless you enjoy watching paint dry.
Written by EduInvesting Team | 30 July 2025
SEO Tags: Dhoot Industrial Finance Q1 FY26 Results, Asset Play Stocks, Undervalued Investment Companies
