1. At a Glance
Shankara just dropped a Q1 FY26 revenue bomb of ₹1,644 Cr (+27% YoY) and a PAT of ₹32 Cr (+102% YoY). Add a 35% volume growth and an upcoming demerger, and this retailer is suddenly looking like the cool kid in the construction yard.
2. Introduction
Think of Shankara as the Home Depot of India – except with better margins than last year and stores that actually make money. After trimming loss-making outlets and switching to hybrid formats, the company’s topline is now strutting down the runway with a hard hat.
3. Business Model – WTF Do They Even Do?
- Retail (52% of revenue): 92 stores, 32 fulfillment centers, 10 states.
- Steel & Other Building Products: From roofing to plumbing, if it holds your house together, they sell it.
- Hybrid Stores: Converting old steel-focused units to multi-category cash cows.
Narration: Omnichannel is the buzzword; bricks meet clicks.
4. Financials Overview
- Q1 FY26 Revenue: ₹1,644 Cr
- PAT: ₹32 Cr
- OPM: 4% (finally not depressing)
Verdict: Margins still skinny, but growth is doing push-ups.
5. Valuation – What’s This Stock Worth?
- Current P/E: 27x
- Fair Value Range: ₹900 – ₹1,200
The stock at ₹1,055 sits comfortably, awaiting the demerger catalyst.
6. What-If Scenarios
- Bull Case: Demerger unlocks retail premium → ₹1,400.
- Bear Case: Margins stay flat → ₹800.
- Base Case: ₹1,100 – ₹1,200 as steady growth continues.
7. What’s Cooking (SWOT Analysis)
Strengths: Expanding retail network, volume growth, hybrid store strategy.
Weakness: Margins still crawling.
Opportunities: Demerger = rerating.
Threats: High competition and raw material volatility.
8. Balance Sheet 💰
| Particulars (Mar’25) | Amount (₹ Cr) |
|---|---|
| Equity Capital | 24 |
| Reserves | 844 |
| Borrowings | 104 |
| Total Assets | 1,802 |
| Comment: Debt is light; reserves solid – balance sheet isn’t screaming. |
9. Cash Flow (FY23–FY25)
| Year | CFO (₹ Cr) | CFI (₹ Cr) | CFF (₹ Cr) |
|---|---|---|---|
| FY23 | 92 | -45 | -43 |
| FY24 | 10 | -27 | 40 |
| FY25 | 64 | -26 | -42 |
| Snark: Cash flow improving; still not the smoothest ride. |
10. Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 9.3% |
| ROCE | 16.8% |
| D/E | 0.06 |
| PAT Margin | 3% |
| P/E | 27x |
| Punchline: Not sexy yet, but definitely working out. |
11. P&L Breakdown – Show Me the Money
| Year | Revenue (₹ Cr) | EBITDA (₹ Cr) | PAT (₹ Cr) |
|---|---|---|---|
| FY23 | 4,030 | 118 | 63 |
| FY24 | 4,828 | 151 | 81 |
| FY25 | 5,697 | 169 | 77 |
| TTM | 6,050 | 187 | 94 |
| Growth? Yes. Profits? Trying harder. |
12. Peer Comparison
| Company | Rev (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Trent | 17,135 | 1,436 | 124 |
| V2 Retail | 1,884 | 72 | 90 |
| Shankara | 6,050 | 94 | 27 |
| Peers are fashion; Shankara is cement – steady, not flashy. |
13. EduInvesting Verdict™
Shankara is shifting gears – trimming fat, boosting volumes, and setting up for a rerating post-demerger. It’s not a “wow” stock yet, but it’s building its way up, brick by brick.
Written by EduInvesting Team | 28 July 2025
Tags: Shankara Building Products, Retail, Q1 FY26 Results, EduInvesting Premium
