1. At a Glance
If you thought tea was recession-proof, meet Diana Tea Company Ltd. Q1 FY26 net profit: ₹1.66 Cr. But over the last 3 years, it’s mostly been steeped in red ink. ROE: -6.88%. ROCE: -1.22%. Market cap is barely a blip at ₹45.7 Cr. Yet, it’s been around since 1911. Colonial hangover or value trap? You decide.
2. Introduction with Hook
Picture a 114-year-old gentleman in Darjeeling sipping tea… and burning cash. That’s Diana Tea Company. It manufactures CTC tea, sells through auction centers, and somehow still can’t make consistent profits.
- Stock trades at 0.71x book value
- EPS is doing a Bollywood dance—up, down, gone
- 10-year revenue CAGR: a princely 5%
Diana is what happens when the product is hot but the business is cold.
3. Business Model (WTF Do They Even Do?)
Diana Tea is in the CTC tea game. It grows, plucks, processes, and sells bulk and branded tea.
- Sells mainly via auctions in Kolkata & Siliguri
- Parent company: Diana Capital Ltd
- Revenue mostly from bulk sales; branding still a side hustle
- Manufacturing since 1911, but profits apparently still “in development”
Basically, they grow leaves, crush them, and auction them. And somehow still lose money doing it.
4. Financials Overview
| Metric | FY25 | 3-Yr Trend |
|---|---|---|
| Revenue | ₹70.8 Cr | -2% CAGR |
| EBITDA | ₹(3.7) Cr | Unstable |
| Net Profit | ₹(4.58) Cr | Bleeding |
| EPS | ₹(3.06) | Good luck, shareholders |
| OPM | -5.2% | Yes, that’s negative |
Profitability comes and goes like monsoon in Assam. Occasionally green, mostly grey.
5. Valuation
CMP: ₹30.5
Book Value: ₹43 → P/B = 0.71x
Fair Value RANGE Estimate (based purely on hope and book value):
- Liquidation logic (P/B 0.8–1x): ₹34 – ₹43
- Optimistic PE (10x on EPS ₹1.6?): ₹16 (but only in a good year)
This is less “valuation” and more “salvage estimate.”
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 PAT: ₹1.66 Cr (surprise profit!)
- AGM scheduled on Aug 25, 2025 — will serve biscuits?
- Re-appointed MD and Independent Director — because nothing says turnaround like the same management
- Other Income (₹4.48 Cr) > Operating Profit — classic accounting cocktail
So yes, tea is being brewed… but it’s mostly other income that keeps the company from evaporating.
7. Balance Sheet
| Item | FY25 |
|---|---|
| Equity Capital | ₹7.5 Cr |
| Reserves | ₹56.9 Cr |
| Borrowings | ₹43.6 Cr |
| Total Liabilities | ₹118.7 Cr |
| Fixed Assets | ₹74.7 Cr |
| Investments | ₹4.05 Cr |
With ₹43.6 Cr in debt and inconsistent profits, this balance sheet has more stress than your average tea garden worker during peak season.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹2.09 Cr | ₹(3.13) Cr | ₹(1.44) Cr | ₹(2.47) Cr |
| FY24 | ₹2.66 Cr | ₹(0.29) Cr | ₹(3.98) Cr | ₹(1.61) Cr |
| FY25 | ₹(3.55) Cr | ₹(2.90) Cr | ₹8.19 Cr | ₹1.75 Cr |
Cash from ops has turned negative again. The tea might be brewing, but the cash is… evaporating.
9. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | -6.88% |
| ROCE | -1.22% |
| OPM | -5.2% |
| D/E | ~0.75x |
| Interest Coverage | <1x (low) |
These are “stressy” with a capital S. Even the chaiwala at CST has better margins.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹76.29 Cr | ₹(1.89) Cr | ₹(2.5) Cr |
| FY24 | ₹73.05 Cr | ₹2.72 Cr | ₹0.24 Cr |
| FY25 | ₹70.82 Cr | ₹(3.68) Cr | ₹(4.58) Cr |
This is the kind of income statement that makes investors scream “Not my cup of tea.”
11. Peer Comparison
| Company | P/E | ROE | OPM | Rev (TTM) | PAT |
|---|---|---|---|---|---|
| Diana Tea | — | -6.88% | -1.16% | ₹76.1 Cr | ₹(1.81) Cr |
| Jay Shree Tea | 9.5x | 9.7% | 4.4% | ₹858 Cr | ₹34.5 Cr |
| Goodricke | 66.8x | 2.9% | 2.1% | ₹929 Cr | ₹7.3 Cr |
| McLeod Russel | — | -141% | 1.5% | ₹1,185 Cr | ₹(217) Cr |
Verdict:
In the land of the blind, Diana is… still blind. But at least it’s cheap.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2025 |
|---|---|
| Promoters | 61.34% |
| Public | 38.66% |
Promoters have maintained their stake — perhaps due to sentimental reasons or masala chai addiction. No FIIs, no DIIs, just retail sipping on hope.
13. EduInvesting Verdict™
Diana Tea is a heritage brand stuck in a commodity trap. It occasionally profits, mostly doesn’t. No brand mojo. Just old plantations, debt, and a market cap that screams “tinycap gamble.”
Final Word:
A slow brew. Nostalgic, yes. Investable? Only if you like your tea with extra risk and zero sugar (or dividends).
Metadata:
Written by EduInvesting Team | 23 July 2025
Tags: Diana Tea Company, CTC Tea, Turnaround Stocks, EduInvesting Premium
