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Check Before You Invest : Jindal Drilling & Industries Ltd

BSE: 511034 NSE: JINDRILL ISIN: INE742C01031
  |   Sector:  Oil & Gas   |   Industry:  Oil Exploration

Snapshot

Q.1 Which industry/sub-sector does Jindal Drilling & Industries Ltd belong to?
Jindal Drilling & Industries Ltd belongs to the Oil & Gas sector, operating specifically within the Oil Exploration segment.
Q.2 Is Jindal Drilling & Industries Ltd a good quality company?
Jindal Drilling & Industries Ltd is a weak quality company, based on a inconsistent 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 Jindal Drilling & Industries Ltd undervalued or overvalued?
Jindal Drilling & Industries Ltd appears Somewhat 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 9.67 14.74
Price to Book 1.3 1.07
Price to Sales 1.91 1.83
EV to EBITDA 4.6 7.59
Q.4 Is Jindal Drilling & Industries Ltd a good buy now?
Jindal Drilling & Industries Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. 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 Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd revenue growth is 34.2% for FY-2025, which is above its 5-year CAGR of 30.81%, indicating faster growth.

Q.2 Gross Profit margin of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 33.5% for FY-2025, which is in line with its 5-year median of 33.5%, indicating stable margins.

Q.3 Operating Profit Margin of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 29.05% for FY-2025, which is in line with its 5-year median of 29.05% indicating stable margins.

Q.4 Net Profit Margin of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Net Profit Margin is 17.01% for FY-2025, is in line with its 5-year median of 17.01%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 33.5 33.5
Operating Profit Margin (%) 29.05 29.05
Net Profit Margin (%) 17.01 17.01

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Return on Asset is 6.48%, which is in line with its 5-year historical median of 6.48%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Return on capital employed is 14.08% for FY-2025, which is above its 5-year historical median of 12.18%. 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 Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Return on equity is 11.33% for FY-2025, which is above its 5-year historical median of 10.18%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Cash conversion cycle is 84 days, below its 5-year historical median of 97 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.38 0.34
ROE (%) 11.33 10.18
ROCE (%) 14.08 12.18
Cash Conversion Cycle 84 days 97 days

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

Q.9 Debt to Equity ratio of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Debt-to-Equity ratio is 0.13, which is above the industry average of 0.07, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Jindal Drilling & Industries Ltd?
Jindal Drilling & Industries Ltd Debt to cash flow from operations is 0.19, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Jindal Drilling & Industries Ltd?

Q.1 Promoter shareholding and pledge status of Jindal Drilling & Industries Ltd?
Promoters hold 66.78% of the Jindal Drilling & Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Jindal Drilling & Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Jindal Drilling & Industries Ltd vs industry peers?
Jindal Drilling & Industries Ltd revenue CAGR is 30.81%, compared to the industry median CAGR of 9.51%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 34.2 9.5
Gross Profit Growth (%) 29.3 16.9
Operating Profit Growth (%) 18.8 15.9
Net Profit Growth (%) 23.7 33.9
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.38 0.21
ROE (%) 11.33 8.66
ROCE (%) 14.08 9.36
Cash Conversion Cycle (days) 84.38 55

Valuation & price assessment

Q.1 Stock return of Jindal Drilling & Industries Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 14.5% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
14.5% 42.9% 29.4% -5.5%
Q.2 Valuation ratios of Jindal Drilling & Industries Ltd vs historical?
The current P/E ratio of 9.67 is lower than its historical median of 14.74, indicating that the stock is trading below 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 9.67 14.74 22.52
Price to Book 1.3 1.07 1.33
Price to Sales 1.91 1.83 4.32
EV to EBITDA 4.6 7.59 7.69

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