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Here's Why We Think Chavda Infra (NSE:CHAVDA) Is Well Worth Watching

Simply Wall St · 2d ago

It's common for many investors, especially those who are inexperienced, to buy shares in companies with a good story even if these companies are loss-making. But as Peter Lynch said in One Up On Wall Street, 'Long shots almost never pay off.' A loss-making company is yet to prove itself with profit, and eventually the inflow of external capital may dry up.

Despite being in the age of tech-stock blue-sky investing, many investors still adopt a more traditional strategy; buying shares in profitable companies like Chavda Infra (NSE:CHAVDA). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business.

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Chavda Infra's Improving Profits

Even with very modest growth rates, a company will usually do well if it improves earnings per share (EPS) year after year. So it's easy to see why many investors focus in on EPS growth. Chavda Infra has grown its trailing twelve month EPS from ₹7.41 to ₹7.73, in the last year. That's a fair increase of 4.3%.

One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. On the revenue front, Chavda Infra has done well over the past year, growing revenue by 43% to ₹3.6b but EBIT margin figures were less stellar, seeing a decline over the last 12 months. So it seems the future may hold further growth, especially if EBIT margins can remain steady.

You can take a look at the company's revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers.

earnings-and-revenue-history
NSEI:CHAVDA Earnings and Revenue History September 3rd 2026

Check out our latest analysis for Chavda Infra

Since Chavda Infra is no giant, with a market capitalisation of ₹3.1b, you should definitely check its cash and debt before getting too excited about its prospects.

Are Chavda Infra Insiders Aligned With All Shareholders?

Seeing insiders owning a large portion of the shares on issue is often a good sign. Their incentives will be aligned with the investors and there's less of a probability in a sudden sell-off that would impact the share price. So we're pleased to report that Chavda Infra insiders own a meaningful share of the business. In fact, they own 73% of the company, so they will share in the same delights and challenges experienced by the ordinary shareholders. This makes it apparent they will be incentivised to plan for the long term - a positive for shareholders with a sit and hold strategy. In terms of absolute value, insiders have ₹2.2b invested in the business, at the current share price. That should be more than enough to keep them focussed on creating shareholder value!

Should You Add Chavda Infra To Your Watchlist?

As previously touched on, Chavda Infra is a growing business, which is encouraging. If that's not enough on its own, there is also the rather notable levels of insider ownership. These two factors are a huge highlight for the company which should be a strong contender your watchlists. It is worth noting though that we have found 3 warning signs for Chavda Infra (1 doesn't sit too well with us!) that you need to take into consideration.

Although Chavda Infra certainly looks good, it may appeal to more investors if insiders were buying up shares. If you like to see companies with more skin in the game, then check out this handpicked selection of Indian companies that not only boast of strong growth but have strong insider backing.

Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.