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Check Before You Invest : Brigade Enterprises Ltd

BSE: 532929 NSE: BRIGADE ISIN: INE791I01019
  |   Sector:  Construction & Infrastructure   |   Industry:  Construction - Real Estate

Snapshot

Q.1 Which industry/sub-sector does Brigade Enterprises Ltd belong to?
Brigade Enterprises Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Construction - Real Estate segment.
Q.2 Is Brigade Enterprises Ltd a good quality company?
Brigade Enterprises Ltd is a average quality company, based on a somewhat consistent 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 Brigade Enterprises Ltd undervalued or overvalued?
Brigade Enterprises Ltd appears Fair, as its key valuation ratios are in line with 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 58.98 48.50
Price to Book 2.58 3.42
Price to Sales 6.24 7.20
EV to EBITDA 30.41 25.53
Q.4 Is Brigade Enterprises Ltd a good buy now?
Brigade Enterprises 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 Brigade Enterprises Ltd?
Brigade Enterprises Ltd revenue growth is 4.5% for FY-2025, which is above its 5-year CAGR of 2.74%, indicating faster growth.

Q.2 Gross Profit margin of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Gross profit margin which is the profit after deduction of direct costs, is 27% for FY-2025, which is above its 5-year median of 24.7%, indicating increasing margins.

Q.3 Operating Profit Margin of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 20.55% for FY-2025, which is below its 5-year median of 22.37% indicating decreasing margins.

Q.4 Net Profit Margin of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Net Profit Margin is 21.51% for FY-2025, is above its 5-year median of 15.71%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 27 24.7
Operating Profit Margin (%) 20.55 22.37
Net Profit Margin (%) 21.51 15.71

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Return on Asset is 3.73%, which is in line with its 5-year historical median of 3.65%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Return on capital employed is 9.11% for FY-2025, which is below its 5-year historical median of 10.13%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 11.25%, indicating value preservation.

Q.7 Return on Equity (ROE) of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Return on equity is 8.84% for FY-2025, which is in line with its 5-year historical median of 8.84%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Cash conversion cycle is 732 days, above its 5-year historical median of 644 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.17 0.21
ROE (%) 8.84 8.84
ROCE (%) 9.11 10.13
Cash Conversion Cycle 732 days 644 days

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

Q.9 Debt to Equity ratio of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Debt-to-Equity ratio is 0.26, which is above the industry average of 0.23, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Brigade Enterprises Ltd?
Brigade Enterprises Ltd Debt to cash flow from operations is 4.72, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Brigade Enterprises Ltd?

Q.1 Promoter shareholding and pledge status of Brigade Enterprises Ltd?
Promoters hold 41.11% of the Brigade Enterprises Ltd, with 0.11% of their stake pledged, indicating low pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Brigade Enterprises Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Brigade Enterprises Ltd vs industry peers?
Brigade Enterprises Ltd revenue CAGR is 2.74%, compared to the industry median CAGR of 0.00%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 4.5 0
Gross Profit Growth (%) 12.6 14.9
Operating Profit Growth (%) -4 10.4
Net Profit Growth (%) 43.1 17.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.17 0.1
ROE (%) 8.84 1.36
ROCE (%) 9.11 3.88
Cash Conversion Cycle (days) 731.91 439

Valuation & price assessment

Q.1 Stock return of Brigade Enterprises Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 20.7% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
20.7% 19.8% 8% -39.7%
Q.2 Valuation ratios of Brigade Enterprises Ltd vs historical?
The current P/E ratio of 58.98 is higher than its historical median of 48.50, 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 58.98 48.50 33.43
Price to Book 2.58 3.42 1.53
Price to Sales 6.24 7.20 5.23
EV to EBITDA 30.41 25.53 14.43

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