Stovec Industries Ltd Q1FY26 FY25: ₹454 Cr Market Cap, 45× P/E, 5.3% Dividend Yield – Is This Printing Money or Just Printing Screens?
1. At a Glance
Here’s the audit file: Stovec Industries Ltd (SIL) – market cap ₹454 Cr, CMP ₹2,172, P/E a nosebleed 44.7, with ROE barely 9.9%. Sales in FY25 = ₹219 Cr, PAT = ₹10.2 Cr, meaning profits look like a government canteen bill compared to valuations.
Yet, company throws money back – dividend yield 5.3% (payout over 200%). Looks like the promoters (71% stake, Dutch parent SPG Prints) treat India like an ATM. Quarter gone by? Sales dipped -7% YoY, profits fell -18%.
So question: are we looking at a hidden gem, or a European uncle’s NRI pension scheme?
2. Introduction
If you’ve ever worn a printed kurta or admired FMCG packaging, chances are a Stovec screen or digital printer was behind it. Founded in 1973, Stovec is the SPG Prints Netherlands’ Indian outpost, catering to textile printing machines, rotary nickel screens, and digital inks.
But here’s the twist: unlike its vibrant designs, its numbers are as dull as Indian accounting standards before Ind-AS. Sales growth over 5 years? A glorious 3.8% CAGR. Profits over 5 years? Actually shrinking at -14% CAGR. Share price over last year? -34%, which is like watching your favorite serial end with a plot twist where everyone dies.
Yet, they pay dividends like a drunken uncle at a wedding – more than 200% payout in some years. Sustainable? Or just a desperate bribe to shareholders so they don’t dump the stock?
3. Business Model – WTF Do They Even Do?
Three buckets:
Textile Printing Solutions (79% rev): Rotary screens, machines, inks. Think of it as the tattoo artist of your bedsheets.
Machinery (15% rev): Capital machines for textile printing. Problem – India’s textile industry is cyclical, exports weak.
Graphics (6% rev): Anilox rollers, Rotamesh, for packaging/graphics printing. Side hustle but niche.
Exports = 22%, Domestic = 78%. Clients spread from Europe to Bangladesh to Mexico, but dependency on global textile cycles is high.
So basically: they sell the picks & shovels for the fabric industry, but when textile mills sneeze, Stovec catches pneumonia.
