The Anatomy of a Fall: Why Agarwal Wouldn’t Budge
When a stock you own falls, the most common reaction for an average investor is to sell. The harder thing is to sit still and ask whether the business broke or only the price did. That gap, between a bad chart and a bad company, is where super investors like Mukul Agarwal make or lose real money.
Mukul Agrawal holds 72 listed stocks worth over Rs 7,377 cr, and he is watched closely for a reason. He buys small and mid-sized businesses early, before the crowd shows up, and does not flinch when they face volatility. Two stocks tied to his stable fit that mould today. Both have taken a beating over the last year. But he refuses to sell them.
One is a small premium paints maker, while the other is a giant old textile brand that split itself in two. Very different businesses, but the same question hangs over each. Did the story change, or did the market simply lose patience? Let us dig into the numbers.
#1 Sirca Paints: A Valuation Reset or a Broken Compounder?
If you have ever admired the glossy finish on a wooden door or a designer wardrobe, there is a decent chance the coating came from Sirca. The company sells premium wood coatings and decorative paints, and it is the exclusive India licensee for the Italian Sirca brand across India, Nepal, Bangladesh and Sri Lanka. It plays at the pricey, design-led end of the paint market rather than the mass end.
With a current market cap of Rs 2,235 cr, the stock’s story is an interesting one. Sirca ran up sharply through 2025, touched a high of about Rs 539, and has since given back a big chunk of that move as it saw a fall to its 52-week low of Rs 385.
Now, while Mukul Agarwal does not directly own the stock in his own portfolio, there is the family angle. The Sirca stake is held by Asha Mukul Agrawal, his wife. She first bought in back in September 2019 and still holds about 2.52% as of the June 2026 quarter, which is worth Rs 57 cr.
Unpacking the 28% Growth: Beyond the Covid Base Effect
Sales have grown from Rs 134 cr in FY20 to Rs 492 cr in FY26, and net profit has moved from Rs 25 cr to Rs 65 cr over the same stretch. The most recent year was a strong one, with sales up sharply as the company pushed into wall paints and folded in the Wembley acquisition, which brought the Welcome brand into its fold.
| Financial Year | FY21 | FY22 | FY23 | FY24 | FY25 | FY26 | 5Y CAGR |
| Sales (Rs cr) | 141 | 196 | 264 | 311 | 372 | 492 | 28% |
| EBITDA (Rs cr) | 12 | 38 | 62 | 69 | 68 | 99 | 52% |
| Net Profit (Rs cr) | 17 | 28 | 46 | 51 | 49 | 65 | 31% |
EBITDA here means operating profit before other income. A word of caution on that EBITDA row, because its five-year growth rate looks big, but you must know that is only because FY21 was a beaten-down covid year, when operating profit collapsed to just Rs 12 cr on a squeezed margin. On a cleaner pre-covid base, operating profit has compounded closer to the low twenties. Sales at 28% and net profit at 31% are the honest headline growth rates.
Why the Market Cooled on Sirca’s Flawless Run
Three things, mostly. First, the valuation got ahead of itself after the big run-up, and the market is now paying less for the same earnings. Second, operating margin has softened from the low twenties a few years ago to around 18% to 20% now, as the wall-paints push carries thinner margins than the premium core. Third, working capital has stretched, with debtor days rising from about 94 to 115, meaning the company waits longer to get paid.
None of these is a red flag on its own. Together they explain why a market that once treated Sirca as a flawless compounder decided to cool off.
The 136% 5-Year Jump: Charting Sirca’s Trajectory
The share price of Sirca was around Rs 170 in July 2021 and as on 27th July 2026 it was Rs 402, which is a 136% jump in 5 years.
As for the valuations, the stock is trading at a PE of 35x against the current industry median of 36x. The stock was listed only in 2018, so a true ten-year valuation history does not exist yet.
The rest of the scorecard is tidy. Return on capital employed sits at about 21%, return on equity near 16%, and the company is close to debt free even after borrowing a little for capex and the Wembley deal. Promoter holding is steady at 65%. For a holder who bought the premiumisation theme, that mix of clean books and steady growth is why the fall reads as a wobble rather than a warning.
#2 Raymond Lifestyle: A Legacy Brand Splitting for Value
Everyone in India knows Raymond. The suiting, the shirting, the wedding-season showrooms. Raymond Lifestyle is the arm that houses that fabric and apparel business, along with brands like Park Avenue, ColorPlus, Parx and Ethnix.
With a market cap of Rs 4,332 cr currently, Raymond Lifestyle was carved out of the old Raymond group and listed on its own in September 2024, part of a plan to split the conglomerate into cleaner, separately traded pieces.
Mukul Agrawal himself holds about 1.2% of Raymond Lifestyle, or roughly 7 lakh shares. He held a 1.3% stake in the company until March 2026. Per the June 2026 filings, that stake was slightly trimmed to 1.2% which is currently worth about Rs 50 cr.
The 2,645 Cr Illusion: Decoding Raymond’s Misleading Profit
Normally at this point I would show a neat five-year growth table and a ten-year valuation average. With Raymond things are different as the company has only existed as a listed, standalone entity since 2024, so there are not five years of comparable numbers, nor ten years of price history to average. So, let’s look at the three real years that exist.
| Financial Year | FY24 | FY25 | FY26 |
| Sales (Rs cr) | 6,535 | 6,177 | 6,888 |
| EBITDA (Rs cr) | 937 | 470 | 658 |
| Net Profit (Rs cr) | 2,645 | 38 | 46 |
That FY24 net profit of Rs 2,645 cr looks spectacular and is deeply misleading, so read it carefully. Nearly Rs 2,310 cr of it was one-off other income tied to the demerger, not money earned from selling suits and shirts.
The real operating profit for the business in a normal year is far more modest, which is why the next two years show net profit of just Rs 38 cr and Rs 46 cr. On a Rs 6,888 cr revenue base, that is thin.
Shrinking Margins and the Waiting Game for Real Profit
The core problem is that a well-known brand is not yet a well-earning one. Operating margin sits in single digits to low double digits, interest costs are heavy, and the bottom line keeps getting eaten. The March 2026 quarter slipped into a net loss of about Rs 52 cr.
Return on equity is close to 2% and the company pays next to nothing by way of dividend. For a market that expected a storied brand to mint money, weak profits were always going to hurt the stock. The June 2026 results are expected soon and it will be worth a watch to see, how things change after that.
Insider Accumulation: Why the Promoter is Buying the Drop
The share price of Raymond Lifestyle when it was listed in September 2024 was around Rs 2,700 and as on 27th July 2026 it was Rs 711, which is a big drop.
The stock is trading at a PE of 39x currently while the industry median is 23x. It trades at roughly half its book value, a price-to-book of about 0.5 times. In plain terms, the market is valuing the whole company at less than the accounting worth of what it owns.
For a deep-value buyer, that is the hook. You are not paying up for earnings that may or may not arrive, you are buying assets and brands at a discount and betting the profits catch up.
Also, the promoter has been raising its own stake steadily, from about 54.7% at listing to 59.6% in June 2026 filings, and the group has been simplifying its structure, including a separate listing of its real estate arm. Insiders adding shares while the price falls is the kind of signal value investors watch for. Whether it pays off depends entirely on the fabric and apparel business finally turning its revenue into real profit.
Growth Paused vs. Value Delayed
The two stocks in Agarwal’s folio tell different stories. Sirca is a healthy, growing business whose stock got too hot and is now catching its breath. The earnings are real and compounding, and the fall looks like a valuation reset. Raymond Lifestyle is the mirror image. Its stock is cheap on assets precisely because the earnings have not shown up yet, and the bet is that a discounted brand portfolio eventually delivers.
That is why the same investor stable can hold both without contradiction. One is a growth story taking a pause. The other is a value story waiting for proof. In neither case has the money been pulled out, which tells you the people closest to these positions think the price fell further than the story did.
For the rest of us, the lesson is less about these two tickers and more about the habit. A falling price is a question, not an answer. Ask what changed, look at the real numbers rather than the mood, and decide for yourself. A sensible next step would be to add both names to a watchlist and keep an eye on how their quarters play out.
Disclaimer:
Note: We have relied on data from http://www.Screener.in and http://www.trendlyne.com throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Suhel Khan has been a passionate follower of the markets for over a decade. During this period, he was an integral part of a leading Equity Research organisation based in Mumbai as the Head of Sales & Marketing. Presently, he is spending most of his time dissecting the investments and strategies of the Super Investors of India.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article. The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein.