Altman Z″
Needs current assets and current liabilities.
DEEPA · Diamond & Jewellery · INE1M2N01020
Analyst mean 0.00 · 0 analysts · 0% bullishThis company listed within the last twelve months, so its prospectus is still the primary source. The figures below were extracted from the DRHP and RHP before listing and scored then, and they are shown here as they stand in the IPO record rather than restated.
Each flag is a fact read in the filing, shown with the context that makes it meaningful.
Stated objects, as worded in the offer document. Deployment against them is tracked separately.
Claims made in the offer document, to be read against what the company has reported since.
Deepa Jewellers Limited, incorporated in 2016 and based in Hyderabad, Telangana, is a prominent organized business-to-business (B2B) designer, processor, and supplier of hallmarked gold jewellery in India. The company operates primarily across the southern states of Andhra Pradesh, Telangana, Karnataka, Tamil Nadu, and Kerala, which accounted for 94.37% (₹1,818.19 crore) of its consolidated revenue from operations in Fiscal 2026. Its product portfolio spans 16 plain and studded gold jewellery categories, with a strong specialization in traditional wedding vaddanams (waist belts) and high-precision CNC machine-cut bangles, which collectively contributed 72.72% (₹1,401.09 crore) of operational revenues in Fiscal 2026. Operating through a capital-efficient outsourced manufacturing model, the company provides raw gold bullion, alloys, and precious stones to a network of 41 skilled karigars in Telangana and Maharashtra who perform the physical fabrication in exchange for making charges. This asset-light model provides high scalability and operational flexibility without requiring heavy capital investments in manufacturing plants. The company serves a robust B2B customer network of 373 clients as of July 31, 2026, comprising 47 prominent national and regional retail chains (such as Joyalukkas, Kalyan Jewellers, Lalithaa, and GRT Jewellers) and 326 standalone stores, with its top 10 customers generating 64.67% (₹1,246.03 crore) of total sales. For the fiscal year ended March 31, 2026, the company reported ₹1,926.68 crore in operational revenues and a profit after tax of ₹104.79 crore.
Deepa Jewellers' competitive moat lies in its position as a leading organized B2B aggregator and processor of specialized gold wedding ornaments (vaddanams and CNC cut bangles) in South India, which has the country's highest market share in gold consumption (~40%). By developing long-standing relationships with 47 of the largest national and regional jewellery retail chains (including Joyalukkas, Kalyan Jewellers, and GRT) and 326 standalone retailers, the company has built a highly defensible distribution network. This moat is further reinforced by its capital-efficient outsourced manufacturing model utilizing 41 skilled karigars, which allows it to scale production to meet seasonal wedding spikes without incurring high capital expenditure or inventory markdown risks. Additionally, its in-house design team of 15 designers continuously updates its catalog of 110 SKUs, while its proprietary mobile catalog application ('Deepa Jewellers Limited') facilitates digital discovery and real-time order tracking for its B2B customers, enhancing client lock-in and trust.
Deepa Jewellers Limited is an organized business-to-business (B2B) gold jewellery designer, processor, and supplier in India, primarily operating across South Indian states. The company specializes in traditional wedding ornaments such as vaddanams (waist belts) and precision-engineered CNC machine-cut bangles, distributing to major organized retail chains and standalone boutiques.
Source: p. 111, 112, 182, 185, 186, 188
Where the revenue came from, as the document splits it.
| Name | Pct | Source |
|---|---|---|
| Sale of products - processing | 99 | p. 183 |
| Sale of services - job work | 0.89 | p. 183 |
| Sale of products - trade | 0.11 | p. 183 |
According to the CRISIL Report, the B2B gems and jewellery industry in India, comprising manufacturers and wholesalers, has shown strong growth, with market size increasing at a CAGR of 24.60% from ₹3,03,000.00 crore (₹3,030.00 billion) in Fiscal 2022 to ₹7,30,100.00 crore (₹7,301.00 billion) in Fiscal 2026. Retail jewellery consumption is heavily concentrated in South India, which commands the highest regional share of 38% to 43%. The South Indian gems and jewellery retail market, valued at ₹5,02,600.00 crore (₹5,026.00 billion) in Fiscal 2026, is projected to grow at a CAGR of 6.00% to 7.00% to reach ₹6,20,000.00 crore to ₹6,60,000.00 crore by Fiscal 2030, driven by deep-rooted cultural affinity, festive demand cycles, and increasing organized retail penetration.
24.60% CAGR (Fiscal 2022 to Fiscal 2026) for the Indian B2B gems and jewellery market, and 6.00% to 7.00% projected CAGR (Fiscal 2026 to Fiscal 2030) for the South Indian retail gems and jewellery industry.
₹7,30,100.00 crore (₹7,301.00 billion) for the Indian B2B gems and jewellery industry in Fiscal 2026, and ₹5,02,600.00 crore (₹5,026.00 billion) for the South Indian retail gems and jewellery industry in Fiscal 2026.
Sector slug: gems-and-jewellery-manufacturing-and-wholesale
Source: p. 129, 134, 186
The comparable set the company chose, which is itself a disclosure.
| Name | Margin | Pb | Pe | Roe | Source |
|---|---|---|---|---|---|
| Sky Gold and Diamonds Limited | 6.86 | 11.17 | 57.56 | 23.88 | p. 114, 115 |
| Shanti Gold International Limited | 9.86 | 3.25 | 12.72 | 37.34 | p. 114, 115 |
| Shringar House of Mangalsutra Limited | 7.07 | 3.3 | 17.02 | 26.29 | p. 114, 115 |
| RBZ Jewellers Limited | 14.43 | 1.86 | 10.08 | 20.11 | p. 114, 115 |
| Khazanchi Jewellers Limited | 6.11 | 6.21 | 22.22 | 32.45 | p. 114, 115 |
As presented in the offer document. Post-listing figures are in the statements above.
The measures this sector is actually judged on, as disclosed in the document. No feed supplies these.
Written before listing, answered from the document itself.
How does the proposed deployment of ₹215.00 crore for working capital requirements align with the company's historical financial performance?
The company is directing 86.00% of its Fresh Issue proceeds (₹215.00 crore out of ₹250.00 crore) to fund incremental working capital, to be deployed as ₹125.00 crore in FY27 and ₹90.00 crore in FY28. This is highly aligned with its business model, which requires maintaining extensive inventories of finished gold ornaments (surged to ₹87.36 crore in FY26) to showcase collections at national B2B exhibitions and support a massive increase in trade receivables, which scaled to ₹252.36 crore in FY26.
p. 12, 101, 102, 104
What are the material customer and geographic concentrations of Deepa Jewellers' B2B business?
The company exhibits significant customer and geographic concentration. Geographically, South Indian states (Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, Kerala) generated 94.37% (₹181.82 crore) of total Fiscal 2026 revenues. Client-wise, its top 10 customers (consisting of prominent retail chains like Kalyan and Joyalukkas) contributed 64.67% (₹124.60 crore) of total revenue from operations in Fiscal 2026, making it highly dependent on the credit health and purchase volumes of these major retail accounts.
p. 185, 186, 188
What factors drove the exceptional net profit surge to ₹104.79 crore in Fiscal 2026, and is this growth sustainable?
The consolidated PAT scaled from ₹24.35 crore in FY24 to ₹104.79 crore in FY26. This was driven by a 36.35% increase in processing revenues, but primarily by exceptional operating leverage. Operating EBITDA margins expanded from 3.49% in FY24 to 7.60% in FY26 as average inventory days fell to 18 days and gold prices elevated. However, sustainability is a concern given that cash flows from operations (CFO) turned negative at -₹14.73 crore in FY26 due to credit extension (trade receivables doubled to ₹252.36 crore).
p. 52, 70, 104
What are the key hidden promoter-related and regulatory risks that prospective public investors must evaluate?
The primary hidden risks include: (i) Promoter-linked funding dependency, with ₹43.65 crore outstanding in unsecured loans from Ashish, Seema, and Dev Agarwal as of March 31, 2026, which are repayable on demand; (ii) retrospective tax or compliance exposures of dissolved partnership firms M/s Deepa Jewellers and M/s Deepa Gold, which were wound up shortly before filing the DRHP; and (iii) the lack of trademark registration for the company's main logos and brand taglines (all applications are currently pending formalities check).
p. 28, 49, 103, 220
What the issue priced at, on the figures in the document.
Ronw: 56.45%
The company has compared itself with five listed peers: Sky Gold & Diamonds, Shanti Gold, Shringar House of Mangalsutra, RBZ Jewellers, and Khazanchi Jewellers, which operate in the gold jewellery manufacturing/wholesale segment.
Source: p. 114, 115, 116
How the book filled. A category that bid far above the rest is a different signal from a uniformly covered issue.
| Date | Name | Shares | Price per share | Category | Source |
|---|---|---|---|---|---|
| 2016-05-05 | Ashish Agarwal and Seema Agarwal (Initial Subscription to the Memorandum of Association) | 2000000 | 10 | Promoters | p. 88 |
| 2016-09-17 | Ashish Agarwal, Seema Agarwal, and Chandrakala Agarwal (Rights Issue) | 2100000 | 10 | Promoters & Promoter Group | p. 88 |
| 2025-11-10 | Stock Split (Face Value sub-division from ₹10 each to ₹2 each) | 20500000 | All Shareholders | p. 88 | |
| 2025-11-28 | Bonus Issue (Ratio of 3 Equity Shares for every 1 existing Equity Share held) | 61500000 | All Shareholders | p. 88, 89 |
Ceo: Ashish Agarwal (Chairman and Managing Director)
As of the date of the Red Herring Prospectus, there are no outstanding criminal, material civil, or tax litigations (direct or indirect tax demand is Nil) pending against the Company, its Promoters, or Directors.
Auditor name: NSVR & Associates LLP, Chartered Accountants
Promoters Ashish Agarwal, Seema Agarwal, and Dev Agarwal collectively hold 81,985,000 Equity Shares, representing 99.98% of the pre-Offer paid-up Equity Share capital (82,000,000 total shares). None of the promoter shares are pledged or encumbered.
None. The statutory auditors' examination report on the Restated Financial Information for Fiscals 2026, 2025, and 2024 is unmodified and contains no reservations, qualifications, adverse remarks, or emphasis of matter.
Auditor changed last 3y: Yes
Source: p. 1, 32, 36, 44, 47, 76, 103, 220, 224, 342, 343, 344, 419
A change between the two filings is a disclosure in itself.
Numbered markers are corporate actions and, once the filings are read, capital and governance events. Prices are split-adjusted so the series is continuous.
What the numbers mean when read together — computed from the filings, not a score.
The business reported a profit, yet its operations drained cash rather than generating it. Profit that comes with negative operating cash is the single most important thing to understand here.
Why this reading: Flagged on a single year deliberately: negative operating cash alongside a reported profit is plain, material, and hard to explain benignly — exactly the kind of obvious signal that should never be smoothed over.
Operating cash flow ₹-15 cr against trailing net profit ₹105 cr. When operations consume cash while the P&L shows profit, ask whether receivables are ballooning, revenue is booked ahead of collection, or costs are being capitalised.
Borrowings rose 41% over 3 years, but only about 26% of the new debt shows up as productive assets — worth understanding what the rest funded.
Why this reading: Kept at caution rather than flagged: the disproportion is real but not extreme, and part of the borrowing may fund working capital or intangibles that this view doesn't capture.
New borrowing ₹34 cr against an asset build of ₹9 cr. Some gap is normal (working capital, dividends); a persistent or widening gap is where it becomes a concern.
Free cash flow is negative — the business consumes more than it generates once capex is paid. Fine if it is deliberate growth investment; a problem if it is structural.
Why this reading: Noted with caution — worth watching, but not yet conclusive on its own. Business has ups and downs; one soft reading is not a verdict.
Latest free cash flow ₹-19 cr, negative in 3 of 5 years. Check whether the burn funds expansion (dark stores, plants, ports) or merely sustains operations.
Net margin improved from 2.4% to 5.4% year-on-year — the business is keeping more of each rupee.
Why this reading: A positive signal in the numbers, shown for balance alongside the concerns.
Quarter net margin 5.4% vs 2.4% four quarters earlier. Expansion from operating leverage is healthy; verify it is not a one-off gain.
Every score below is calculated here from the reported numbers — none of it is asserted. Open the notebook at the foot of the section to see each formula with this company's figures in it.
Needs current assets and current liabilities.
Piotroski F-Score — fundamental momentum — Joseph Piotroski, University of Chicago, 2000, in a study of whether accounting signals could improve returns among cheap stocks.
Nine yes-or-no tests across profitability, leverage and operating efficiency. Each pass scores one. It asks a narrow question: is this business getting better or worse on its own terms, year over year?
How to read it7 or more suggests improving fundamentals; 3 or fewer suggests deterioration. It measures direction, not quality — a weak company improving can score higher than a strong one holding steady.
Where it failsA single year of comparison, so one unusual year distorts it. Says nothing about valuation, competitive position or management. Piotroski designed it to rank already-cheap stocks, not to judge a company in isolation.
Needs trade receivables, current assets, other expenses.
Accruals are 41.7% of assets. Free cash flow negative in 3 of 5 years.
DuPont decomposition — Devised inside the DuPont Corporation in the 1920s and still the standard way to read a return on equity.
Splits return on equity into its three sources, so the same headline number can be traced to very different businesses.
How to read itA 20% ROE built on margin and turnover is a different proposition from a 20% ROE built on 3× leverage. The first survives a downturn; the second amplifies it.
Where it failsA single year. Negative equity makes it meaningless. Leverage is structural for lenders, so the third term carries no signal there.
Capital is going in far faster than revenue is coming out. For a business mid-build that is expected — the test is whether it converts.
cumulative operating cash flow ÷ cumulative net profit
₹-18 cr ÷ ₹208 cr, over 5 years
-0.09×
Below 1.0 and persistent means profit is being recognised before the cash arrives.(net profit − operating cash flow) ÷ average total assets
(₹105 − ₹-15) cr ÷ average assets
41.7%
The share of profit that is accounting entries rather than cash. Above ~10% is where accruals start to dominate.net margin × asset turnover × leverage
5.4% × 5.40 × 1.50
44.1%
Splits ROE into whether returns come from operations or from borrowing.EBIT ÷ finance cost
₹146 cr ÷ ₹6 cr
24.33×
How many times operating profit covers the interest bill.borrowings ÷ net worth
₹117 cr ÷ ₹238 cr
0.49×
Read against the sector — infrastructure carries more than software.growth in fixed assets + CWIP, against growth in revenue
capital +900% vs revenue +109%, FY2023 to FY2026
791pp gap
Money going in far faster than revenue coming out. For an incubator this is expected — the test is whether it eventually converts.Needs more balance-sheet detail (only 3 of 6 flags testable).
NOPAT over equity plus debt less cash, at a notional 25% tax. Incremental ROIC is the return on money put in since then — the number that decides whether growth creates value or consumes it.
Return on invested capital, and incremental ROIC — Standard in corporate finance; the incremental form was popularised by Michael Mauboussin as the test of whether growth creates value.
ROIC measures what the business earns on all the capital it employs — equity plus debt, less cash. Incremental ROIC asks a sharper question: what has it earned on the money put in since a chosen year?
How to read itROIC comfortably above the cost of capital — call it 11–13% in India — means growth compounds. Below it, growth consumes. Incremental below headline means recent investment is earning less than the legacy business.
Where it failsDistorted in the year of a large acquisition. Understated for companies mid-build, where capital is deployed but capacity has not yet been commissioned — an incubator will look poor until it does not.
Read downward. Cash can cover EBITDA and still not survive capex — the third rung is where a capital-hungry business shows itself.
The earnings quality ladder — Not a named model — the standard sequence an analyst walks when testing whether reported profit is real.
Three ratios read in order, each stricter than the last.
How to read itRead downward. Each rung failing where the one above passed tells you exactly where the cash is going.
Where it failsA single year of heavy capex depresses the third rung legitimately. Judge it across a cycle.
Against a policy rate near 6%, most sound Indian corporates borrow between 7% and 10%.
Cost of debt — Interest expense over average borrowings — the effective rate the company actually pays.
What the lenders charge, which is a market verdict on credit quality that no rating agency delay affects.
How to read itAgainst a policy rate near 6%, most sound Indian corporates borrow between 7% and 10%. Read the direction over years as much as the level.
Where it failsUnderstated where a large share of interest is capitalised into projects under construction. Not meaningful for lenders, where interest is cost of goods.
Models that need these lines are withheld rather than estimated: net worth, current assets, current liabilities, trade receivables, inventory, net block. Nothing on this page is back-solved from a figure the company did not publish.
Each framework below is a set of stated, mechanical criteria from published work, run against this company's own filed numbers. Passing or failing a screen is not a verdict — different frameworks disagree by design, and that disagreement is itself informative.
Benjamin Graham's stated criteria for a defensive stock, applied to the filed numbers. A company failing several is not disqualified — Graham designed these to be deliberately strict.
Two ratios only: what the business earns on its capital, and what you pay for those earnings. Designed to be ranked across a universe rather than read in isolation.
The fundamental half of William O'Neil's framework. The market and leadership components are judgement calls and are not scored here.
The characteristics long-term holders commonly look for: cash-backed earnings, high returns on capital, and debt that never forces a decision.
Bars are revenue; the line is net margin. Revenue rising while the line falls is the shape worth noticing.
Operating cash first, then what the business spent and raised.
One year is a snapshot. These are the two lines that matter across a cycle.
Rising debtor or inventory days against flat sales is the earliest visible sign of stress.
Set your own assumptions and watch the numbers move. A scenario calculator — the outputs are the arithmetic of your inputs.
One canonical set of figures — the same numbers used everywhere else on this page and on the screener.
Where cash gets stuck. A rising inventory or debtor line against flat sales is the earliest sign of trouble in the numbers.
| Measure | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Debtor days
How long customers take to pay | 26 | 36 | 32 | 34 | 48 |
| Inventory days
How long stock sits before it sells | 36 | 19 | 27 | 23 | 18 |
| Payable days
How long the company takes to pay suppliers | 4 | 0 | 0 | 0 | 0 |
| Cash conversion cycle
Debtor + inventory − payable days | 58 | 54 | 58 | 57 | 66 |
| Working capital days | 28 | 38 | 43 | 45 | 52 |
| ROCE %
Return on capital employed | — | 27.0% | 23.0% | 31.0% | 52.0% |
The shape of the business over time (annual) — read the direction, not the single print.
| Line | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Revenue from operations | 638 | 921 | 1,025 | 1,397 | 1,927 |
| Other income | 0 | 0 | 1 | 3 | 1 |
| Depreciation | 0 | 0 | 0 | 0 | 1 |
| Finance cost | 3 | 4 | 4 | 4 | 6 |
| Profit before tax | 22 | 30 | 33 | 54 | 140 |
| Net profit (owners) | 16 | 22 | 24 | 41 | 105 |
| EPS (₹) | 40.15 | 53.71 | 59.39 | 98.98 | 12.78 |
Exceptional items, total income and EBITDA are read from the filed statements.
| Metric | Sep 2025 |
|---|---|
| Revenue | 812 |
| Other Income | 0 |
| Expenses | 745 |
| Depreciation | 0 |
| Finance cost | 2 |
| Profit before tax | 65 |
| Net Profit | 49 |
| EPS | 118.56 |
| Item | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Equity Capital | 4 | 4 | 4 | 4 | 16 |
| Reserves | 42 | 64 | 88 | 129 | 222 |
| Borrowings | 51 | 83 | 78 | 81 | 117 |
| Net block | 0 | 1 | 1 | 1 | 8 |
| CWIP | 0 | 0 | 0 | 0 | 2 |
| Investments | 0 | 0 | 0 | 0 | 0 |
| Total Assets | 105 | 153 | 175 | 218 | 357 |
| Line | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Cash from operations | 8 | -6 | 5 | -10 | -15 |
| Cash from investing | 0 | -16 | 6 | 10 | -4 |
| Cash from financing | -8 | 22 | -9 | -2 | 19 |
| Free cash flow | 8 | -7 | 5 | -10 | -19 |
| Net change in cash | 0 | 0 | 1 | -1 | 0 |
Cash from operations is the number profit has to answer to. Free cash flow is what remains after the business pays for its own growth.
These are coverage counts, not ratings. Each one asks a fixed set of questions of the filings and reports how many the company answered. A company that discloses nothing counts nothing here — that is a statement about the disclosure, not about the business.
The same read, applied to the companies this one competes with.