The stock’s fundamental metrics suggest a strong potential upside, but risks of expansion and market saturation must be watched closely, according to the analyst.

WOL 3D India is transforming into a vertically integrated player, offering 3D hardware and now toys. Last week, the company held its first post-listing earnings call, outlining ambitious plans to transform itself into India’s 3D-printed toy powerhouse. 

It is betting on ‘Vinglits’, its fully 3D-printed toy line to power the next growth phase. According to SEBI-registered analyst Rajneesh Sharma, if the management hits its store roll-out, inventory, and export milestones, its current micro-cap valuation could look cheap in hindsight.  

The company’s total market value of ₹84 crore is less than twice its annual revenue, making its price-to-sales (P/S) ratio under 2, which is often considered undervalued, Sharma said. It has a modest price-to-earnings (P/E) ratio of 15, despite holding more cash than debt (net-cash).

WOL 3D’s enterprise value to EBITDA (EV/EBITDA) stands at 10×, a standard valuation for healthy mid- to small-cap firms. Its price-to-book (P/B) ratio is at 2.3 while its return on capital employed (ROCE) is above 30%, indicating high capital efficiency.

Using a Discounted Cash Flow (DCF) model with a 14% expected annual growth (CAGR) and an 18% weighted average cost of capital (WACC), the intrinsic value is estimated to be between ₹160 and ₹175 per share. That represents a 25-35% premium to the current stock price of ₹129, according to Sharma. 

WOL3D India was founded in 2019 as a small reseller of desktop 3D printers. Looking ahead, management aims to expand exports, launch new products like concrete 3D printers and robotic-arm kits, and improve working capital efficiency.

However, potential risks exist, Sharma said. Executing a rapid scale-up, expanding to over 30 stores, and growing a consumer brand could strain resources. The current inventory buildup needs efficient liquidation to free up cash flows.

Additionally, over 50% of printer parts are still imported from China, making localisation a top priority. The stock’s low float on the SME platform can also lead to sharp price volatility, he added.

WOL 3D reported a strong FY25 with revenue of ₹48 crore, up 20% on a year-on-year basis, supported by a net-cash balance sheet. Its Inventory days rose to 281 due to pre-stocking of stores and toys amid geopolitical disruptions.

Gross margins dipped 300 basis points in H2 because of promotional toy launches, but are expected to recover as scale improves. The current business mix comprises hardware (85%), consumables such as in-house PLA/ABS filaments (12%), and services (3%) through its Brahma prototyping farm.

Year-to-date, the stock has lost 6.9% of its value.

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