The company's financial trajectory paints a grim picture of operational collapse. Sharp India has reported zero net sales for every quarter tracked over the past two years, indicating complete cessation of business activities. Despite the absence of revenue, the company continues to incur substantial employee costs of ₹1.26 crores in Q2 FY26, alongside interest expenses of ₹3.34 crores, resulting in an operating loss (PBDIT excluding other income) of ₹1.90 crores for the quarter.
The company's balance sheet reveals a state of complete erosion of shareholder value. As of March 2025, Sharp India reported negative shareholder funds of ₹117.91 crores, with reserves and surplus standing at negative ₹148.72 crores against a share capital of ₹30.81 crores. This negative net worth situation has persisted and worsened over multiple years, with current liabilities ballooning to ₹120.70 crores whilst current assets stand at a meagre ₹1.30 crores, highlighting severe liquidity constraints and an inability to meet short-term obligations.
Financial Performance: A Company Without Operations
Sharp India's quarterly performance demonstrates not merely poor results, but the complete absence of business operations. The company has not generated a single rupee of revenue for at least seven consecutive quarters through September 2025. In Q2 FY26, the net loss of ₹7.44 crores compares unfavourably to the ₹5.17 crores loss in Q1 FY26 and the ₹4.79 crores loss in Q2 FY25, representing a consistent deterioration in the company's financial position.
| Quarter | Net Sales (₹ Cr) | Operating Profit (₹ Cr) | Interest (₹ Cr) | Net Loss (₹ Cr) |
|---|---|---|---|---|
| Sep'25 | 0.00 | -1.90 | 3.34 | -7.44 |
| Jun'25 | 0.00 | -1.89 | 3.26 | -5.17 |
| Mar'25 | 0.00 | -1.58 | 2.96 | -4.57 |
| Dec'24 | 0.00 | -2.20 | 2.86 | -5.09 |
| Sep'24 | 0.00 | -2.14 | 2.62 | -4.79 |
| Jun'24 | 0.00 | -2.26 | 2.54 | -4.84 |
| Mar'24 | 0.00 | -2.40 | 2.43 | -4.85 |
The escalating interest burden presents a particularly alarming trend. Interest expenses have climbed from ₹2.43 crores in March 2024 to ₹3.34 crores in September 2025, a 37.45% increase, despite the company generating no revenue. This rising interest cost against zero income demonstrates an unsustainable financial structure that continues to deplete whatever residual value remains in the company.
Employee costs, whilst relatively stable at around ₹1.25 crores per quarter, represent a fixed burden that the company cannot support without operational revenue. The maintenance of staff in the absence of business activities suggests either statutory requirements or preparations for potential restructuring, though no concrete revival plans are evident from the financial data.
Critical Financial Warning
Negative Net Worth Alert: Sharp India's shareholder funds stand at negative ₹117.91 crores as of March 2025, with book value per share at negative ₹47.32. The company has completely eroded its equity capital and continues to accumulate losses without any operational revenue. Current liabilities of ₹120.70 crores dwarf current assets of ₹1.30 crores, indicating severe solvency concerns and potential insolvency risk.
The Debt Burden: Interest Without Income
One of the most troubling aspects of Sharp India's financial position is the persistent and growing interest burden despite the absence of any revenue-generating activities. The company's interest expenses have shown a concerning upward trajectory, rising from ₹2.43 crores in March 2024 to ₹3.34 crores in September 2025. This 37.45% increase in interest costs over six quarters, whilst revenue remains at absolute zero, highlights a debt structure that is spiralling out of control.
Historically, Sharp India had long-term debt of ₹33.18 crores as of March 2021, which was subsequently eliminated from the balance sheet by March 2022. However, the continuing interest expenses suggest the presence of other financial obligations, possibly in the form of accumulated liabilities to creditors or related parties that are accruing interest charges. The company's current liabilities have ballooned from ₹26.01 crores in March 2020 to ₹120.70 crores in March 2025, representing a staggering 364% increase over five years.
The cash flow statements reveal a pattern of chronic cash burn. For the financial year ending March 2025, cash flow from operations stood at negative ₹8.00 crores, a figure that has remained consistently negative for at least six consecutive years. The company has been relying entirely on financing activities to fund its operations, with cash flow from financing contributing ₹7.00 crores in FY25. This pattern of borrowing to fund losses rather than operations is fundamentally unsustainable and points towards eventual insolvency unless dramatic restructuring occurs.
Operational Collapse: From Electronics Manufacturer to Non-Operating Entity
Sharp India's transformation from an operational electronics manufacturer to a non-operating entity represents one of the more dramatic corporate declines in the Indian electronics sector. The company, originally incorporated as Kalyani Telecommunications and Electronics Private Limited in 1985 and later renamed Sharp India Limited in 2005, once operated as part of the Kalyani House of Industries conglomerate. However, the financial data reveals a complete cessation of manufacturing and commercial activities.
The company's revenue history shows a precipitous decline from ₹25.00 crores in FY17 to just ₹1.00 crore in FY18, followed by absolute zero thereafter. This represents a 96% revenue collapse in a single year, followed by complete operational shutdown. The five-year sales growth rate stands at negative 0.40%, though this figure understates the severity given that recent years have seen zero revenue entirely.
Fixed assets, which stood at ₹5.84 crores in March 2020, have depreciated to just ₹1.44 crores by March 2025, suggesting minimal capital expenditure and potential asset liquidation or impairment. Current assets have similarly deteriorated from ₹4.01 crores in March 2020 to ₹1.30 crores in March 2025, indicating a company that is liquidating whatever resources remain rather than investing in revival.
Historical Context: The Sharp India Decline
Sharp India's operational history reveals a company that once had meaningful business activities but has been in terminal decline for nearly a decade. The last year of significant revenue was FY17, when the company posted sales of ₹25.00 crores. By FY18, revenue had collapsed by 96% to just ₹1.00 crore, and from FY19 onwards, the company has reported zero sales consistently. This extended period of non-operation, coupled with mounting losses and negative net worth, suggests a company that exists in name only, with no realistic prospect of operational revival under current circumstances.
Peer Comparison: Worst Performer in Electronics Sector
When compared to peers in the electronics and appliances sector, Sharp India's financial metrics paint the picture of a company in a fundamentally different category—one that is non-operational and financially distressed. Whilst peer companies demonstrate positive profitability and operational metrics, Sharp India stands as an outlier with negative net worth and zero revenue.
| Company | P/E Ratio | P/BV Ratio | ROE (%) | Debt to Equity |
|---|---|---|---|---|
| Sharp India | NA (Loss Making) | -0.81 | 0.00% | -0.99 |
| Veto Switchgears | 9.48 | 0.72 | 8.40% | 0.05 |
| Calcom Vision | 26.51 | 1.79 | 6.76% | 0.62 |
| Khaitan (India) | 7.08 | 1.70 | 7.15% | 0.34 |
| Gothi Plascon | 25.57 | 3.69 | 12.81% | 0.18 |
| Dolphin Kitchen | 11.94 | 0.72 | 22.47% | 0.10 |
The stark contrast is evident across all metrics. Whilst peer companies demonstrate return on equity ranging from 6.76% to 22.47%, Sharp India reports 0.00% ROE—a figure that reflects the complete absence of equity value given the negative net worth. The negative price-to-book ratio of -0.81x for Sharp India, compared to positive ratios between 0.72x and 3.69x for peers, underscores the market's recognition that the company's liabilities exceed its assets.
Even amongst the smallest players in the electronics sector, Sharp India stands out for all the wrong reasons. With a market capitalisation of just ₹112.00 crores, it ranks as the third-largest in its peer group by market cap, yet is the only company with zero revenue and negative equity. This positioning suggests that the current market valuation may reflect speculative interest or residual hope for restructuring rather than any fundamental business value.
Valuation Analysis: A Company Trading on Hope, Not Fundamentals
Sharp India's valuation metrics defy conventional analysis, as the company lacks the fundamental characteristics—revenue, profitability, positive equity—that underpin traditional valuation frameworks. The stock currently trades at ₹40.75, down 52.81% over the past year and 55.17% below its 52-week high of ₹90.89. This price level values the company at a market capitalisation of ₹112.00 crores despite negative shareholder funds of ₹117.91 crores.
The price-to-book ratio of -0.81x is mathematically negative due to the negative book value per share of ₹47.32. In practical terms, this means investors are paying ₹40.75 per share for a company where each share represents a negative ₹47.32 of net worth—an economically irrational situation that can only be explained by speculation on potential restructuring, asset sales, or other extraordinary events.
Enterprise value metrics are similarly distorted. The EV/EBITDA ratio of -31.07x and EV/EBIT ratio of -30.42x reflect negative enterprise value relative to negative earnings. The company's proprietary valuation assessment is classified as "RISKY," a designation it has held since July 2024, with brief interruptions. This classification accurately captures the speculative and distressed nature of any investment in Sharp India shares.
Valuation Warning: Speculation Over Fundamentals
Sharp India's current market price of ₹40.75 cannot be justified through traditional valuation methods. With zero revenue, mounting quarterly losses, and negative net worth of ₹117.91 crores, the company has no earnings to discount, no book value to reference, and no operational cash flows to value. Any investment at current levels represents pure speculation on potential restructuring, promoter support, or asset monetisation—none of which are evident from available financial data. The stock's 52.81% decline over the past year reflects growing market recognition of this fundamental value disconnect.
Shareholding Pattern: Promoter Commitment Amidst Financial Distress
The shareholding pattern of Sharp India reveals one of the few stable elements in an otherwise deteriorating financial picture. Promoter holding has remained rock-solid at 75.00% across the last five quarters through December 2025, with zero sequential change in any period. This unwavering promoter stake, held by Sharp Corporation, demonstrates continued commitment despite the company's operational collapse and mounting losses.
| Quarter | Promoter % | FII % | MF % | Insurance % | Non-Institutional % |
|---|---|---|---|---|---|
| Dec'25 | 75.00% | 0.00% | 0.01% | 0.00% | 24.99% |
| Sep'25 | 75.00% | 0.00% | 0.01% | 0.00% | 24.99% |
| Jun'25 | 75.00% | 0.00% | 0.01% | 0.00% | 24.99% |
| Mar'25 | 75.00% | 0.00% | 0.01% | 0.00% | 24.99% |
| Dec'24 | 75.00% | 0.00% | 0.01% | 0.00% | 24.99% |
Notably, there is virtually no institutional interest in the stock. Foreign institutional investors hold 0.00%, insurance companies hold 0.00%, and mutual funds hold a negligible 0.01%. This complete absence of institutional participation reflects the professional investment community's assessment that Sharp India represents an uninvestable proposition given its financial distress and lack of operational viability.
The stable 24.99% non-institutional holding suggests a base of retail investors who have either held positions through the decline or are engaging in speculative trading. Importantly, there is no promoter pledging, indicating that whilst Sharp Corporation maintains its 75% stake, it has not leveraged these shares for additional financing—a small positive in an otherwise challenging situation.
Stock Performance: Severe Underperformance Across All Timeframes
Sharp India's stock performance has been disastrous across virtually all timeframes, with the stock generating massive negative alpha relative to the Sensex benchmark. The one-year return of negative 52.81% compares to the Sensex's positive 9.01% return, resulting in underperformance of 61.82 percentage points. This represents one of the poorest relative performances in the Indian equity market.
| Period | Stock Return | Sensex Return | Alpha |
|---|---|---|---|
| 1 Day | -3.89% | 0.25% | -4.14% |
| 1 Week | 0.27% | 0.64% | -0.37% |
| 1 Month | 4.59% | 0.83% | +3.76% |
| 3 Month | -18.50% | 0.88% | -19.38% |
| 6 Month | -25.91% | 5.53% | -31.44% |
| YTD | 3.85% | -1.11% | +4.96% |
| 1 Year | -52.81% | 9.01% | -61.82% |
| 3 Years | -28.88% | 38.88% | -67.76% |
| 5 Years | 42.48% | 64.25% | -21.77% |
| 10 Years | -19.31% | 254.70% | -274.01% |
The three-year return of negative 28.88% versus the Sensex's positive 38.88% results in 67.76 percentage points of underperformance. Even more strikingly, the ten-year return shows Sharp India down 19.31% whilst the Sensex has surged 254.70%, representing a staggering 274.01 percentage points of underperformance over the decade.
The stock's beta of 1.50 indicates high volatility relative to the market, with volatility measured at 67.58% versus the Sensex's 11.54%. This high beta, combined with consistently negative returns, places Sharp India in the "high risk, low return" category—the worst possible quadrant for investors. The risk-adjusted return of -0.78 over one year, compared to the Sensex's positive 0.78, further underscores the poor risk-reward profile.
Technical indicators reflect the stock's bearish trajectory. The current technical trend is classified as "mildly bearish," having transitioned from "bearish" on February 4, 2026. The stock trades below all major moving averages—5-day (₹41.37), 20-day (₹40.13), 50-day (₹40.64), 100-day (₹46.51), and 200-day (₹52.17)—indicating sustained downward momentum with no technical support in sight.
Quality Assessment: Below Average and Deteriorating
Sharp India's quality assessment reflects the harsh reality of a company that has failed on virtually every fundamental metric. The overall quality grade is classified as "Below Average," a designation that understates the severity of the situation given the company's complete operational shutdown and negative equity position.
The five-year sales growth of negative 0.40% masks the true extent of revenue collapse, as recent years have seen absolute zero revenue. The five-year EBIT growth of 3.98% is a statistical anomaly given that EBIT has been consistently negative throughout this period. The average EBIT to interest coverage ratio of 0.0x indicates complete inability to service debt from operations—a critical red flag for any company but particularly alarming for one with mounting interest expenses.
On the positive side, Sharp India is technically a net cash company with an average net debt to equity ratio of -0.99, though this metric is distorted by the negative equity base. The company has zero promoter pledging, suggesting that promoters, whilst maintaining their 75% stake, have not leveraged shares for additional financing. However, these limited positives are vastly outweighed by the fundamental operational and financial failures.
Investment Thesis: Key Strengths and Critical Concerns
Key Strengths
- Stable Promoter Holding: Sharp Corporation maintains unwavering 75% stake with zero pledging, demonstrating continued commitment despite financial distress.
- No Additional Debt Burden: Company has eliminated long-term debt from balance sheet, with no fresh borrowings despite operational challenges.
- Micro-Cap Positioning: Small market cap of ₹112 crores could theoretically enable easier restructuring or acquisition compared to larger entities.
- Brand Legacy: Historical association with Sharp Corporation brand name may retain residual value in potential restructuring scenarios.
Critical Concerns
- Zero Revenue: Company has reported zero net sales for at least seven consecutive quarters through September 2025, indicating complete operational shutdown.
- Negative Net Worth: Shareholder funds of negative ₹117.91 crores with book value per share at negative ₹47.32 represents complete equity erosion.
- Mounting Quarterly Losses: Net loss of ₹7.44 crores in Q2 FY26, up 55.32% QoQ, demonstrates accelerating financial deterioration.
- Rising Interest Burden: Interest expenses increased 37.45% from ₹2.43 crores to ₹3.34 crores over six quarters despite zero revenue.
- Chronic Cash Burn: Operating cash flow negative ₹8.00 crores annually for six consecutive years with no improvement trajectory.
- Severe Liquidity Crisis: Current liabilities of ₹120.70 crores vastly exceed current assets of ₹1.30 crores, indicating potential insolvency.
- No Institutional Support: Zero FII holding, zero insurance holding, and negligible 0.01% mutual fund holding reflects professional investors' complete avoidance.
- Massive Stock Underperformance: One-year return of negative 52.81% versus Sensex positive 9.01%, representing 61.82 percentage points of underperformance.
Outlook: What Lies Ahead for Sharp India
Potential Catalysts (Highly Speculative)
- Restructuring Initiative: Promoter-led restructuring or asset monetisation plan, though no such initiative is evident from current data.
- Strategic Sale: Potential sale to strategic buyer interested in brand name or residual assets, though value proposition is unclear.
- Debt Forgiveness: Negotiated settlement with creditors to reduce accumulated liabilities, enabling fresh start.
- Operational Revival: Resumption of manufacturing operations with external funding, though no signs of such plans exist.
Critical Red Flags
- Continued Operational Shutdown: No indication of business revival or revenue generation plans in foreseeable future.
- Accelerating Loss Trajectory: Quarterly losses increasing rather than stabilising, indicating deteriorating financial position.
- Insolvency Risk: Current liability burden of ₹120.70 crores against minimal assets may trigger insolvency proceedings.
- Further Stock Decline: Technical indicators and fundamental deterioration suggest continued downward price pressure.
- Delisting Possibility: Prolonged non-compliance with exchange requirements could lead to delisting from stock exchanges.
- Complete Value Erosion: Continued losses without operational revival may result in total shareholder value destruction.
The Verdict: A Company in Terminal Decline
Score: 17/100
For Fresh Investors: Avoid completely. Sharp India represents an uninvestable proposition with zero revenue, negative net worth of ₹117.91 crores, mounting quarterly losses, and no visible path to operational revival. The stock has declined 52.81% over the past year and faces high risk of further value erosion or potential insolvency. Any investment would be pure speculation on extraordinary restructuring events with no fundamental support.
For Existing Holders: Exit immediately at any available price. The company's financial position has deteriorated materially, with quarterly losses accelerating from ₹4.79 crores in Q2 FY25 to ₹7.44 crores in Q2 FY26. With negative shareholder funds, chronic cash burn, and rising interest burden against zero revenue, the risk of complete capital loss is substantial. The 75% promoter holding provides no comfort given the absence of any visible revival or restructuring plan.
Fair Value Estimate: Not applicable. Traditional valuation methods cannot be applied to a company with zero revenue, negative equity, and no operational cash flows. Current market price of ₹40.75 appears to reflect residual speculative interest rather than any fundamental value. Risk of further 50-70% downside exists if insolvency proceedings are initiated or delisting occurs.
Note- ROCE= (EBIT - Other income)/(Capital Employed - Cash - Current Investments)
⚠️ Investment Disclaimer
This article is for educational and informational purposes only and should not be construed as financial advice. Investors should conduct their own due diligence, consider their risk tolerance and investment objectives, and consult with a qualified financial advisor before making any investment decisions. Sharp India Limited represents an extremely high-risk investment with significant potential for complete capital loss. The company's negative net worth, zero revenue, and mounting losses indicate severe financial distress that may result in insolvency or liquidation.
