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INVESTMENT INSIGHTS

Check Before You Invest : Greaves Cotton Ltd

BSE: 501455 NSE: GREAVESCOT ISIN: INE224A01026
  |   Sector:  Automobiles   |   Industry:  Diesel Engines

Snapshot

Q.1 Which industry/sub-sector does Greaves Cotton Ltd belong to?
Greaves Cotton Ltd belongs to the Automobiles sector, operating specifically within the Diesel Engines segment.
Q.2 Is Greaves Cotton Ltd a good quality company?
Greaves Cotton Ltd is a average quality company, based on a somewhat consistent 10 year financial track record.
Q.3 Is Greaves Cotton Ltd undervalued or overvalued?
Greaves Cotton Ltd appears Somewhat Undervalued, as its key valuation ratios are below with their past averages.
Q.4 Is Greaves Cotton Ltd a good buy now?
Greaves Cotton Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Greaves Cotton Ltd?
Greaves Cotton Ltd revenue growth is 10.8% for FY-2025 , which is above its 5 year CAGR of 8.8% , indicating faster growth.
Q.2 Gross Profit margin of Greaves Cotton Ltd?
Greaves Cotton Ltd Gross profit margin which is the profit after deduction of direct costs, is 6% for FY-2025 , which is above its 5 year median of 5.6% , indicating increasing margins.
Q.3 Operating Profit Margin of Greaves Cotton Ltd?
Greaves Cotton Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 4.65% for FY-2025 , which is in line with its 5 year median of 4.65% indicating stable margins.
Q.4 Net Profit Margin of Greaves Cotton Ltd?
Greaves Cotton Ltd Net Profit Margin is -0.22% for FY-2025 , is above with its 5 year median of -1.25%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 6 5.6
Operating Profit Margin 4.65 4.65
Net Profit Margin -0.22 -1.25
Q.5 Return on Asset of Greaves Cotton Ltd?
Greaves Cotton Ltd Return on Asset is -0.25%, which is above its 5 year historical median of -1.5%, indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Greaves Cotton Ltd?
Greaves Cotton Ltd Return on equity is -0.45% for FY-2025 , which is above its historical median of -2.38%, indicating the business is making better use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Greaves Cotton Ltd?
Greaves Cotton Ltd Return on capital employed is 6.02% for FY-2025 , which is below its estimated weighted average cost of capital(WACC) 13.5%, indicating value preservation.
Q.8 Cash conversion cycle of Greaves Cotton Ltd?
Greaves Cotton Ltd Cash conversion cycle is 14 days, above its historical median of 1 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 1.17 1.18
ROE -0.45 -2.38
ROCE 6.02 -0.86
Cash Conversion Cycle 14 days 1 days
Q.9 Debt to Equity ratio of Greaves Cotton Ltd?
Greaves Cotton Ltd Debt-to-Equity ratio is 0.04 , which is above with the industry average of 0 , indicating higher debt levels in the industry.
Q.10 Debt to cash flow from operations of Greaves Cotton Ltd?
Greaves Cotton Ltd Debt to cash flow from operations is -2.37 , which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Greaves Cotton Ltd?
Promoters hold 55.80% of the Greaves Cotton Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Greaves Cotton Ltd vs industry peers?
Greaves Cotton Ltd revenue CAGR is 8.84% , compared to the industry median CAGR of 4.42% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 2,918.4 709.6
Gross Profit 175.1 73.7
Operating Profit 135 45
Net Profit -6 -9.5
Operating Efficiency
Current Level Industry Median
Asset Turnover 1.17 0.59
ROE -0.45 -1.19
ROCE 6.02 -0.43
Cash Conversion Cycle (days) 14.39 -

Valuation & price assessment

Q.1 Stock return of Greaves Cotton Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 1.7% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 1.7% 5.4% 6.7% -16.5%
Q.3 Valuation ratios of Greaves Cotton Ltd vs historical?
The current P/E is higher that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 33.92 31.15 52.27
Price to Book 2.67 2.54 7.77
Price to Sales 1.13 1.24 1.86
EV to EBITDA 13.89 12.64 19.90

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