Shankara Building Products Ltd. (SHANKARA) AI Stock Analysis

• Market Cap: ₹2.63B
• Dividend Yield: 0.68%
• Average Volume (3M): 69.61K
• Price to Earnings (P/E): 3.6
• Beta (1Y): 0.72
• Revenue Growth: -3.36%
• EPS Growth: -6.25%
• Country: IN
• Employees: 725
• Sector: Services
• Sector Strength: N/A
• Industry: Home Improvement
• EPS (TTM): -2.13
• Shares Outstanding: 24,249,327
• 10 Day Avg. Volume: 171,315
• 30 Day Avg. Volume: 69,611
• PEG Ratio: -2.31
• Price to Book (P/B): 1.63
• Price to Sales (P/S): 0.25
• P/FCF Ratio: 37.68
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: ₹122.00 ▼(-4.54% Downside)

The score is driven mainly by strong financial performance (growth, low leverage, improving cash flow) and an attractive valuation (very low P/E). This is partially offset by mixed technicals, with a negative MACD and price still below longer-term moving averages despite short-term strength.

Positive Factors

Multi‑channel distribution & one‑stop model

A diversified multi‑channel model (physical stores, e‑commerce, direct sales) and wide product breadth create durable customer reach and cross‑sell opportunities. This reduces single‑channel risk, supports scale economics, and strengthens market positioning versus niche distributors.

Low financial leverage and strong equity base

Very low leverage and a nearly 50% equity ratio provide financial flexibility to fund expansion, absorb cyclical downturns, and pursue strategic partnerships without pressuring cash flow. This balance‑sheet strength supports capital allocation and long‑term stability.

Improving cash generation and OCF conversion

Transition to positive free cash flow and strong OCF conversion reflects improving working capital and core cash generation. Durable cash flow enhances ability to self‑fund inventory, capex, and reduce volatility from seasonal construction cycles over the medium term.

Negative Factors

Thin net profit margins

A sub‑2% net margin leaves limited buffer against input cost inflation, price competition, or operational shocks. Over time this constrains retained earnings for reinvestment and heightens sensitivity of returns to modest revenue or cost swings in a low‑margin distribution business.

Low gross and EBITDA margins limit scalability

Relatively low gross and EBITDA margins indicate constrained pricing power and high cost pass‑through in the supply chain. This structural margin pressure can limit reinvestment capacity, reduce ROIC upside, and leave the business vulnerable to supplier or logistic cost shocks.

Earnings cyclicality tied to construction demand

Heavy reliance on real estate/infrastructure end markets creates durable demand sensitivity: downturns in construction activity can materially depress volumes and working capital dynamics. While long‑term infrastructure growth is supportive, cyclical exposure raises earnings volatility risk.

Shankara Building Products Ltd. Business Overview & Revenue Model

Company Description

Shankara Building Products Limited operates as a retailer of home improvement and building products in India. It operates through Retail, Channel, and Enterprise segments. The company offers structural steel products, cement, TMT bars, hollow blocks, pipes and tubes, roofing solutions, welding accessories, primers, solar heaters, plumbing products, tiles, sanitary ware, water tanks, plywood, kitchen sinks, and lighting, flooring, electricals, interior-exterior finishing, irrigation, and other allied products. It also processes roofing sheets, steel pipes and tubes, cold rolled strips, and color coated roofing sheets, as well as operates as general hardware and wholesale traders. The company serves homeowners, professional customers, and small enterprises; end users, contractors, and OEMs; and other dealers and retailers. As of June 10, 2022, it operated 91 Shankara Buildpro brand stores. The company was formerly known as Shankara Infrastructure Materials Limited and changed its name to Shankara Building Products Limited in July 2006. Shankara Building Products Limited was incorporated in 1995 and is headquartered in Bengaluru, India.

How the Company Makes Money

Shankara Building Products Ltd. generates revenue primarily through the sale of building materials and products across its retail and wholesale channels. The company's revenue model is built on a multi-channel approach, which includes physical retail stores, an e-commerce platform, and direct sales to contractors and builders. Key revenue streams include the sale of cement, steel, tiles, and sanitary ware, which are essential for construction projects. Additionally, the company may benefit from strategic partnerships with manufacturers and suppliers, allowing them to offer a diverse range of products and enhance their market presence. The growth in real estate and infrastructure development in India also contributes significantly to SHANKARA's earnings, as the demand for quality building materials continues to rise.

Shankara Building Products Ltd. Financial Statement Overview

Summary

Shankara Building Products Ltd. exhibits a strong financial position with substantial revenue growth, moderate profitability, and solid balance sheet fundamentals. The company's strategic focus on improving operational efficiencies is reflected in its rising EBIT and EBITDA margins. While cash flow metrics show positive trends, maintaining consistent free cash flow growth remains crucial. The company's low leverage and strong equity base provide a stable foundation for future growth.

Income Statement

Shankara Building Products Ltd. has demonstrated strong revenue growth with a significant increase from ₹48.28 billion in 2024 to ₹56.97 billion in 2025, a growth rate of approximately 18%. The gross profit margin stands at 5.58% in 2025, showing improvement from previous years. The net profit margin is 1.36%, indicating profitability, yet there is room for enhancement. EBIT and EBITDA margins are 4.56% and 2.97% respectively, reflecting solid operational performance. Overall, the income statement indicates robust growth and profitability, albeit with some margin pressure.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.12 in 2025, signaling low financial leverage. The return on equity is 8.92%, suggesting efficient use of equity to generate profits. The equity ratio is 48.17%, indicating a strong equity base relative to total assets. The company's financial stability is further supported by a consistent increase in stockholders' equity over the years. However, minor fluctuations in total debt levels require monitoring.

Cash Flow

There is a positive trend in cash flow management with free cash flow improving to ₹375.7 million in 2025 from negative figures in 2024. The operating cash flow to net income ratio is 0.82, indicating a good conversion of income into cash flow. The free cash flow to net income ratio is 0.49, demonstrating effective cash generation relative to income. Although free cash flow growth was negative from 2024 to 2025, the overall cash flow position is strengthening.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	60.50B	56.97B	48.28B	40.30B	24.09B	20.32B
Gross Profit	3.21B	3.18B	2.61B	2.24B	1.59B	1.43B
EBITDA	1.89B	1.69B	1.52B	1.25B	876.50M	771.44M
Net Income	937.50M	774.00M	811.30M	630.50M	343.20M	138.50M
Balance Sheet
Total Assets	0.00	18.02B	15.86B	12.92B	10.41B	9.26B
Cash, Cash Equivalents and Short-Term Investments	231.90M	298.30M	344.00M	58.70M	24.80M	109.04M
Total Debt	0.00	1.04B	866.50M	878.40M	1.33B	1.69B
Total Liabilities	-8.68B	9.34B	7.88B	6.49B	4.85B	4.04B
Stockholders Equity	8.68B	8.68B	7.98B	6.43B	5.56B	5.22B
Cash Flow
Free Cash Flow	0.00	375.70M	-204.60M	472.10M	497.10M	1.16B
Operating Cash Flow	0.00	636.00M	97.20M	919.60M	696.40M	1.33B
Investing Cash Flow	0.00	-263.90M	-272.00M	-452.00M	-183.80M	-81.17M
Financing Cash Flow	0.00	-423.70M	399.60M	-433.70M	-596.80M	-1.28B

Shankara Building Products Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 127.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SHANKARA, the sentiment is Negative. The current price of 127.8 is above the 20-day moving average (MA) of 111.03, above the 50-day MA of 119.35, and below the 200-day MA of 189.65, indicating a bearish trend. The MACD of -1.17 indicates Negative momentum. The RSI at 44.69 is Neutral, neither overbought nor oversold. The STOCH value of 35.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:SHANKARA.

Shankara Building Products Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SHANKARA	76 Outperform	₹2.63B	3.58	―	0.68%	-3.36%	-6.25%
UNIPARTS	73 Outperform	₹19.61B	16.86	―	3.06%	-3.81%	14.23%
RAMKY	67 Neutral	₹35.35B	17.30	―	―	-15.09%	-15.98%
CAPACITE	64 Neutral	₹20.57B	10.28	―	―	15.23%	8.61%
SBCL	60 Neutral	₹24.64B	28.35	―	0.67%	4.56%	8.11%
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
SABTNL	51 Neutral	₹46.91B	-470.91	―	―	―	―

Shankara Building Products Ltd. Corporate Events

Shankara Buildpro Gains BSE and NSE Approval for Equity Listing After Demerger

Shankara Building Products Limited has announced that Shankara Buildpro Limited, the resulting company formed under a court-approved Scheme of Arrangement, has received approvals from both BSE Limited and the National Stock Exchange of India for the listing and trading of its equity shares, effective January 9, 2026. The separate listing of Shankara Buildpro marks a key milestone in the demerger process, potentially providing greater transparency and value discovery for shareholders while allowing each entity to focus more sharply on its core operations and strategic priorities within the building materials and retail space.