Check Before You Invest : K&R Rail Engineering Ltd

Snapshot

Q.1 Which industry/sub-sector does K&R Rail Engineering Ltd belong to?

K&R Rail Engineering Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.

Q.2 Is K&R Rail Engineering Ltd a good quality company?

K&R Rail Engineering Ltd is a average quality company, based on a somewhat consistent 10-year financial track record.

Q.3 Is K&R Rail Engineering Ltd undervalued or overvalued?

K&R Rail Engineering Ltd appears Somewhat Undervalued, as its key valuation ratios are below with their past averages.

Q.4 Is K&R Rail Engineering Ltd a good buy now?

K&R Rail Engineering 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

Q.1 Revenue growth of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd revenue growth is 4.5% for FY-2025, which is below its 5-year CAGR of 37.71%, indicating slower growth.

Q.2 Return on capital employed (ROCE) of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Return on capital employed is 9.6% for FY-2025, which is below its 5-year historical median of 12.18%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.3 Return on Asset of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Return on Asset is 2.35%, which is below its 5-year historical median of 3.85%, indicating deteriorated asset utilization efficiency.

Q.4 Return on Equity (ROE) of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Return on equity is 9.73% for FY-2025, which is below its 5-year historical median of 13.23%, indicating the business is making worse use of its shareholders capital.

Q.5 Cash conversion cycle of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Cash conversion cycle is 17 days, below its 5-year historical median of 52 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	2.75	2.27
ROE	9.73	13.23
ROCE	9.6	12.18
Cash Conversion Cycle	17 days	52 days

Q.6 Gross Profit margin of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Gross profit margin which is the profit after deduction of direct costs, is 1.6% for FY-2025, which is below its 5-year median of 3.4%, indicating decreasing margins.

Q.7 Operating Profit Margin of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 1.66% for FY-2025, which is below its 5-year median of 3.83% indicating decreasing margins.

Q.8 Net Profit Margin of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Net Profit Margin is 0.85% for FY-2025, is below with its 5-year median of 1.7%, indicating decreasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	1.6	3.4
Operating Profit Margin	1.66	3.83
Net Profit Margin	0.85	1.7

Q.9 Debt to Equity ratio of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Debt-to-Equity ratio is 0.00, which is lower with the industry average of 0.39, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of K&R Rail Engineering Ltd?

K&R Rail Engineering Ltd Debt to cash flow from operations is -0.01, which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of K&R Rail Engineering Ltd?

Promoters hold 49.50% of the K&R Rail Engineering Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of K&R Rail Engineering Ltd vs industry peers?

K&R Rail Engineering Ltd revenue CAGR is 37.71%, compared to the industry median CAGR of 9.45%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	4.5	9.5
Gross Profit Growth	-23.1	14.9
Operating Profit Growth	-	11.1
Net Profit Growth	-28.6	18.3

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	2.75	0.68
ROE	9.73	8.34
ROCE	9.6	11.34
Cash Conversion Cycle (days)	16.98	57

Valuation & price assessment

Q.1 Stock return of K&R Rail Engineering Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 13.2% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	13.2%	17.7%	-57.2%	-70.8%

Q.3 Valuation ratios of K&R Rail Engineering Ltd vs historical?

The current P/E is lower that its historical median.

Q.4 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	-	44.00	21.62
Price to Book	1.33	2.62	1.75
Price to Sales	0.36	0.62	1.50
EV to EBITDA	-12.46	24.94	11.53

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