Value Added Product Mix Shift
Expected: OngoingMEDIUM confidence
What: Product categories: Health and Hygiene care
Precot Ltd: Why Is It Outperforming Nifty 500?
ActiveRS +30.5%Weak7w Streak
In , Precot Ltd (Textiles - Technical Textile) is outperforming Nifty 500 with +30.5% relative strength. Fundamentals: Weak. On a 7-week streak.
Precot Ltd Key Facts
- PE Ratio
- 18.7x
- Market Cap
- ₹744 Cr
- PAT Growth YoY
- -37%
- Revenue Growth YoY
- -2%
- OPM
- 10.8%
- RS vs Nifty 500
- +30.5%
PE: Mid ContractionFalling Knife
What's Happening
🔻Earnings declining and PE falling — fundamentals deteriorating
💰Trading 77% above estimated fair value — significant premium
Earnings Acceleration Triggers
1. Value Added Product Mix Shift
OngoingMEDIUM
Key Risks
1. Fluctuating raw material costs in the textile sector impacting margins
HIGH2. Pending arbitration in the Supreme Court regarding a shareholder dispute and pow
MEDIUMSector-Specific Signals
Operating Margin7.18%-29.65%
Net Profit Margin2.77%-36.03%
Return on Equity9.5%
Key Numbers
PAT Growth YoY
-37%
Stable
Revenue YoY
-2%
Stable
Operating Margin
10.8%
-150 bps YoY
PE Ratio
18.7
Current Price
₹620
Dividend Yield
0.48%
Fundamental Score
34/100
Weak
3Y PAT CAGR
-32%
Market Cap
744 Cr
Valuation
Significantly Overvalued12-Week Performance
Weekly presence in the outperformers list. Green = beating Nifty 500 by 10%+ that week.
12 weeks agoThis week
Why Are Precot Ltd's Earnings Accelerating?
Based on Q3 FY26 (web) earnings • Updated Apr 18, 2026
What Are the Key Risks for Precot Ltd?
Earnings deceleration risks from management commentary
Fluctuating raw material costs in the textile sector impacting margins
HIGHTrigger: Fluctuating raw material costs in the textile sector impacting margins.
Monitor: commodity
Pending arbitration in the Supreme Court regarding a shareholder dispute and pow
MEDIUMTrigger: Pending arbitration in the Supreme Court regarding a shareholder dispute and power consumption agreement.
Management view: Seeking appointment of sole arbitrator in New Delhi.
Monitor: litigation
What Did Precot Ltd Report This Quarter?
Headline numbers from the latest earnings call
Revenue
₹208.96 Cr
YoY -16.7%QoQ -2.3%
Revenue declined both sequentially and annually, reflecting weak market demand.
EBITDA
₹22.47 Cr
YoY -7.07%Margin 10.8%
Operating profit saw a sharper sequential decline than revenue, indicating margin pressure.
PAT
₹5.78 Cr
YoY -37.4%QoQ -17.8%
Net profit was significantly impacted by rising interest costs and lower operating income.
Other Highlights
• Earnings per share (EPS) stood at ₹4.81 for Q3 FY26.
• Total expenses decreased 15.6% YoY to ₹200.99 Cr.
• Tax expense for Q3FY26 was ₹2.19 crores, up 36% QoQ.
What Sector Metrics Matter for Precot Ltd?
Sub-sector-specific signals from the latest concall — each with management's stated reason for the change
Operating Margin
7.18%
YoY -29.65%
Why: Not explained in source
Net Profit Margin
2.77%
YoY -36.03%QoQ -15.85%
Why: Not explained in source
Return on Equity
9.5%
Why: Based on trailing twelve months to September 2025.
How Fast Is Precot Ltd Growing?
Revenue, profit and margin growth rates
| Metric | YoY | 3Y CAGR | Trend |
|---|---|---|---|
| Revenue | -2% | -4% | Stable |
| PAT (Net Profit) | -37% | -32% | Stable |
| OPM | 10.8% | -150 bps | Stable |
The above analysis is parsed from publicly available earnings call transcripts. This is educational research only — not investment advice. Last updated Apr 18, 2026.
Frequently Asked Questions: Precot Ltd
Based on publicly available financial data. This is educational research, not investment advice.
What were Precot Ltd's latest quarterly results?
Precot Ltd's latest quarterly results (Dec 2025) show
- PAT Growth YoY: -37.4% (stable)
- Revenue Growth YoY: -1.9%
- Operating Margin: 10.8% (stable)
Is Precot Ltd's profit growing or declining?
Precot Ltd's profit is declining with an stable trend.
- PAT Growth YoY: -37.4% (latest quarter)
- PAT Growth QoQ: -17.8% (sequential)
- 3-Year PAT CAGR: -32.0%
- Trend: Stable — consistent growth pattern
What is Precot Ltd's revenue growth trend?
Precot Ltd's revenue growth trend is stable.
- Revenue Growth YoY: -1.9%
- Revenue Growth QoQ: -2.6% (sequential)
- 3-Year Revenue CAGR: -4.4%
How is Precot Ltd's operating margin trending?
Precot Ltd's operating margin is stable.
- Current OPM: 10.8%
- OPM Change YoY: -1.5% basis points
- OPM Change QoQ: -1.0% basis points
What is Precot Ltd's 3-year profit and revenue CAGR?
Precot Ltd's long-term compounding rates
- 3-Year Profit CAGR: -32.0%
- 3-Year Revenue CAGR: -4.4%
Is Precot Ltd's growth accelerating or decelerating?
Precot Ltd's earnings growth is stable with mixed signals on a sequential basis.
- YoY Acceleration: -4.3% bps
- Sequential Acceleration: +20.0% bps
What is Precot Ltd's trailing twelve month (TTM) performance?
Precot Ltd's trailing twelve month (TTM) performance
- TTM PAT: ₹28 Cr
- TTM PAT Growth: -32.5% YoY
- TTM Revenue: ₹856 Cr
- TTM Revenue Growth: -5.1% YoY
- TTM Operating Margin: 12.2%
Is Precot Ltd overvalued or undervalued?
Precot Ltd appears significantly overvalued based on our fair value analysis.
- Valuation Signal: Significantly Overvalued
- Current PE: 18.7x
- Price-to-Book: 1.6x
What is Precot Ltd's current PE ratio?
Precot Ltd's current PE ratio is 18.7x.
- Current PE: 18.7x
- Market Cap: 744 Cr
- Dividend Yield: 0.48%
How does Precot Ltd's valuation compare to its history?
Precot Ltd's current PE is 18.7x.
- Current PE: 18.7x
- Valuation Assessment: Significantly Overvalued
What is Precot Ltd's price-to-book ratio?
Precot Ltd's price-to-book ratio is 1.6x.
- Price-to-Book (P/B): 1.6x
- Book Value per Share: ₹386
- Current Price: ₹620
Is Precot Ltd a fundamentally strong company?
Precot Ltd is rated Weak with a fundamental score of 34/100. This score is calculated from objective financial metrics
- Revenue Growth YoY: -1.9% (10% weight)
- PAT Growth YoY: -37.4% (10% weight)
- PAT Growth QoQ: -17.8% (10% weight)
- Margins stable (10% weight)
Is Precot Ltd debt free?
Precot Ltd has a debt-to-equity ratio of N/A.
- Total Debt: ₹329 Cr
What is Precot Ltd's return on equity (ROE) and ROCE?
Precot Ltd's return ratios over recent years
- FY2023: ROCE 0.0%
- FY2024: ROCE 8.0%
- FY2025: ROCE 13.0%
Is Precot Ltd's cash flow positive?
Precot Ltd's operating cash flow is positive (FY2025).
- Cash from Operations (CFO): ₹116 Cr
- Free Cash Flow (FCF): ₹74 Cr
- CFO/PAT Ratio: 352% (strong cash conversion)
What is Precot Ltd's dividend yield?
Precot Ltd's current dividend yield is 0.48%.
- Dividend Yield: 0.48%
- Current Price: ₹620
Who holds Precot Ltd shares — promoters, FII, DII?
Precot Ltd's shareholding pattern (Mar 2026)
- Promoters: 61.5%
- FII (Foreign): 0.0%
- DII (Domestic): 0.0%
- Public: 38.5%
Is promoter holding increasing or decreasing in Precot Ltd?
Precot Ltd's promoter holding has remained stable recently.
- Current Promoter Holding: 61.5% (Mar 2026)
- Previous Quarter: 61.5% (Dec 2025)
- Change: 0.00% (stable)
How long has Precot Ltd been outperforming Nifty 500?
Precot Ltd has been outperforming Nifty 500 for 7 consecutive weeks, indicating building momentum.
Is Precot Ltd a new momentum entry or an established outperformer?
Precot Ltd is an established outperformer with 7 weeks of consecutive Nifty 500 outperformance.
What are the growth catalysts for Precot Ltd?
Precot Ltd has 1 key growth catalyst identified from recent earnings analysis
- Value Added Product Mix Shift — Shift toward technical textiles like health/hygiene products typically offers higher margins than commodity yarn.
What are the key risks in Precot Ltd?
Precot Ltd has 2 key risks worth monitoring
- [HIGH] Fluctuating raw material costs in the textile sector impacting margins — Fluctuating raw material costs in the textile sector impacting margins.
- [MEDIUM] Pending arbitration in the Supreme Court regarding a shareholder dispute and pow — Pending arbitration in the Supreme Court regarding a shareholder dispute and power consumption agreement.
What is Precot Ltd's management guidance for growth?
Precot Ltd's management has provided the following forward guidance
- Revenue outlook: Not Given
- Margin outlook: Not Given
What sector-specific metrics matter most for Precot Ltd?
Precot Ltd's most important sub-sector-specific KPIs from the latest concall
- Operating Margin: 7.18% (YoY -29.65%) — Not explained in source
- Net Profit Margin: 2.77% (YoY -36.03%) (QoQ -15.85%) — Not explained in source
- Return on Equity: 9.5% — Based on trailing twelve months to September 2025.
Is Precot Ltd worth studying for long term investment?
Based on quantitative research signals, here is why Precot Ltd may be worth studying
- Cash flow is positive — CFO ₹116 Cr
What is the investment thesis for Precot Ltd?
Precot Ltd investment thesis summary:
Research Signals (Bull Case)
- Growth catalyst: Value Added Product Mix Shift
Risk Factors (Bear Case)
- Appears significantly overvalued
- Key risk: Fluctuating raw material costs in the textile sector impacting margins
What is the future outlook for Precot Ltd?
Precot Ltd's forward outlook based on current data signals
- Earnings Trend: stable
- Revenue Trend: stable
- Margin Trend: stable
- Valuation: Significantly Overvalued
- Key Catalyst: Value Added Product Mix Shift
- Key Risk: Fluctuating raw material costs in the textile sector impacting margins
The above FAQs are generated from publicly available earnings data and conference call transcripts. This is educational research only. Sector Alpha is not SEBI registered and does not provide investment advice.