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INVESTMENT INSIGHTS

Check Before You Invest : Kranti Industries Ltd

BSE: 542459 NSE: ISIN: INE911T01010
  |   Sector:  Automobiles   |   Industry:  Auto Ancillary

Snapshot

Q.1 Which industry/sub-sector does Kranti Industries Ltd belong to?
Kranti Industries Ltd belongs to the Automobiles sector, operating specifically within the Auto Ancillary segment.
Q.2 Is Kranti Industries Ltd a good quality company?
Kranti Industries Ltd is a quality company, based on a 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 Kranti Industries Ltd undervalued or overvalued?
Kranti Industries Ltd appears Undervalued, as its key valuation ratios are lower 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 28.95 35.15
Price to Book 1.7 2.95
Price to Sales 0.95 1.01
EV to EBITDA 8.32 11.49
Q.4 Is Kranti Industries Ltd a good buy now?
Kranti Industries 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 Kranti Industries Ltd?
Kranti Industries Ltd revenue growth is -11.6% for FY-2025, which is below its 5-year CAGR of 8.71%, indicating slower growth.

Q.2 Gross Profit margin of Kranti Industries Ltd?
Kranti Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 7.1% for FY-2025, which is in line with its 5-year median of 7.2%, indicating stable margins.

Q.3 Operating Profit Margin of Kranti Industries Ltd?
Kranti Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 10.46% for FY-2025, which is in line with its 5-year median of 9.98% indicating stable margins.

Q.4 Net Profit Margin of Kranti Industries Ltd?
Kranti Industries Ltd Net Profit Margin is -1.04% for FY-2025, is below its 5-year median of 1.33%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 7.1 7.2
Operating Profit Margin (%) 10.46 9.98
Net Profit Margin (%) -1.04 1.33

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Kranti Industries Ltd?
Kranti Industries Ltd Return on Asset is -0.86%, which is below its 5-year historical median of 1.47%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Kranti Industries Ltd?
Kranti Industries Ltd Return on capital employed is 3.03% for FY-2025, which is below its 5-year historical median of 7.41%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Kranti Industries Ltd?
Kranti Industries Ltd Return on equity is -2.03% for FY-2025, which is below its 5-year historical median of 3.85%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Kranti Industries Ltd?
Kranti Industries Ltd Cash conversion cycle is 90 days, above its 5-year historical median of 31 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) 0.83 1.1
ROE (%) -2.03 3.85
ROCE (%) 3.03 7.41
Cash Conversion Cycle 90 days 31 days

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

Q.9 Debt to Equity ratio of Kranti Industries Ltd?
Kranti Industries Ltd Debt-to-Equity ratio is 0.92, which is above the industry average of 0.40, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Kranti Industries Ltd?
Kranti Industries Ltd Debt to cash flow from operations is -92.75, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Kranti Industries Ltd?

Q.1 Promoter shareholding and pledge status of Kranti Industries Ltd?
Promoters hold 62.28% of the Kranti Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Kranti Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Kranti Industries Ltd vs industry peers?
Kranti Industries Ltd revenue CAGR is 8.71%, compared to the industry median CAGR of 11.82%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -11.6 11.8
Gross Profit Growth (%) -32.1 16.3
Operating Profit Growth (%) -26.7 14.9
Net Profit Growth (%) -167.6 20.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.83 1.23
ROE (%) -2.03 11.57
ROCE (%) 3.03 13.36
Cash Conversion Cycle (days) 90.33 47

Valuation & price assessment

Q.1 Stock return of Kranti Industries Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 31.91% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR		 - 31.9% -6.1% -38.9%
Q.2 Valuation ratios of Kranti Industries Ltd vs historical?
The current P/E ratio of 28.95 is lower than its historical median of 35.15, 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 28.95 35.15 28.71
Price to Book 1.7 2.95 2.99
Price to Sales 0.95 1.01 1.35
EV to EBITDA 8.32 11.49 11.85

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