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Check Before You Invest : ADC India Communications Ltd

BSE: 523411 NSE: KRONECOMM ISIN: INE833A01016
  |   Sector:  Telecom   |   Industry:  Telecommunication - Equipment

Snapshot

Q.1 Which industry/sub-sector does ADC India Communications Ltd belong to?
ADC India Communications Ltd belongs to the Telecom sector, operating specifically within the Telecommunication - Equipment segment.
Q.2 Is ADC India Communications Ltd a good quality company?
ADC India Communications Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is ADC India Communications Ltd undervalued or overvalued?
ADC India Communications Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 52.21 28.92
Price to Book 11.4 7.03
Price to Sales 4.94 2.63
EV to EBITDA 37.16 19.72
Q.4 Is ADC India Communications Ltd a good buy now?
ADC India Communications Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of ADC India Communications Ltd?
ADC India Communications Ltd revenue growth is 6.9% for FY-2026, which is below its 5-year CAGR of 27.29%, indicating slower growth.

Q.2 Gross Profit margin of ADC India Communications Ltd?
ADC India Communications Ltd Gross profit margin which is the profit after deduction of direct costs, is 12.1% for FY-2026, which is in line with its 5-year median of 12.1%, indicating stable margins.

Q.3 Operating Profit Margin of ADC India Communications Ltd?
ADC India Communications Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 10.31% for FY-2026, which is in line with its 5-year median of 10.22% indicating stable margins.

Q.4 Net Profit Margin of ADC India Communications Ltd?
ADC India Communications Ltd Net Profit Margin is 9.46% for FY-2026, is in line with its 5-year median of 9.46%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 12.1 12.1
Operating Profit Margin (%) 10.31 10.22
Net Profit Margin (%) 9.46 9.46

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of ADC India Communications Ltd?
ADC India Communications Ltd Return on Asset is 12.71%, which is in line with its 5-year historical median of 12.71%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of ADC India Communications Ltd?
ADC India Communications Ltd Return on capital employed is 31.44% for FY-2026, which is in line with its 5-year historical median of 31.44%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of ADC India Communications Ltd?
ADC India Communications Ltd Return on equity is 24.16% for FY-2026, which is in line with its 5-year historical median of 24.16%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of ADC India Communications Ltd?
ADC India Communications Ltd Cash conversion cycle is 22 days, in line with its 5-year historical median of 22 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.38 1.52
ROE (%) 24.16 24.16
ROCE (%) 31.44 31.44
Cash Conversion Cycle 22 days 22 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of ADC India Communications Ltd?
ADC India Communications Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.03, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of ADC India Communications Ltd?
ADC India Communications Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of ADC India Communications Ltd?

Q.1 Promoter shareholding and pledge status of ADC India Communications Ltd?
Promoters hold 72.02% of the ADC India Communications Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does ADC India Communications Ltd performance compare with that of its Peers?

Q.1 Revenue growth of ADC India Communications Ltd vs industry peers?
ADC India Communications Ltd revenue CAGR is 27.29%, compared to the industry median CAGR of 8.37%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 6.9 8.4
Gross Profit Growth (%) -24.2 33
Operating Profit Growth (%) -27.6 15.5
Net Profit Growth (%) -20.8 51.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.38 0.59
ROE (%) 24.16 -
ROCE (%) 31.44 0.14
Cash Conversion Cycle (days) 21.92 123

Valuation & price assessment

Q.1 Stock return of ADC India Communications Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 23.2% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
23.2% 52.7% 36.2% 80.7%
Q.2 Valuation ratios of ADC India Communications Ltd vs historical?
The current P/E ratio of 52.21 is higher than its historical median of 28.92, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 52.21 28.92 31.57
Price to Book 11.4 7.03 2.63
Price to Sales 4.94 2.63 6.09
EV to EBITDA 37.16 19.72 14.85

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