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Check Before You Invest : KSB Ltd

BSE: 500249 NSE: KSB ISIN: INE999A01023
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Compressors / Pumps

Snapshot

Q.1 Which industry/sub-sector does KSB Ltd belong to?
KSB Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Compressors / Pumps segment.
Q.2 Is KSB Ltd a good quality company?
KSB Ltd is a good quality company, based on a consistently good 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 KSB Ltd undervalued or overvalued?
KSB Ltd appears 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 56.37 48.92
Price to Book 8.64 8.20
Price to Sales 5.27 4.71
EV to EBITDA 32.92 29.84
Q.4 Is KSB Ltd a good buy now?
KSB 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

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 KSB Ltd?
KSB Ltd revenue growth is 6.4% for FY-2025, which is below its 5-year CAGR of 17.41%, indicating slower growth.

Q.2 Gross Profit margin of KSB Ltd?
KSB Ltd Gross profit margin which is the profit after deduction of direct costs, is 15.9% for FY-2025, which is in line with its 5-year median of 15.4%, indicating stable margins.

Q.3 Operating Profit Margin of KSB Ltd?
KSB Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.86% for FY-2025, which is in line with its 5-year median of 13.56% indicating stable margins.

Q.4 Net Profit Margin of KSB Ltd?
KSB Ltd Net Profit Margin is 9.81% for FY-2025, is in line with its 5-year median of 9.79%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 15.9 15.4
Operating Profit Margin (%) 13.86 13.56
Net Profit Margin (%) 9.81 9.79

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of KSB Ltd?
KSB Ltd Return on Asset is 10.67%, which is in line with its 5-year historical median of 10.87%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of KSB Ltd?
KSB Ltd Return on capital employed is 23.41% for FY-2025, which is in line with its 5-year historical median of 23.94%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 13.5%, indicating value creation.

Q.7 Return on Equity (ROE) of KSB Ltd?
KSB Ltd Return on equity is 17.41% for FY-2025, which is in line with its 5-year historical median of 17.43%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of KSB Ltd?
KSB Ltd Cash conversion cycle is 128 days, above its 5-year historical median of 103 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) 1.11 1.12
ROE (%) 17.41 17.43
ROCE (%) 23.41 23.94
Cash Conversion Cycle 128 days 103 days

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

Q.9 Debt to Equity ratio of KSB Ltd?
KSB Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.07, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of KSB Ltd?
KSB Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of KSB Ltd?

Q.1 Promoter shareholding and pledge status of KSB Ltd?
Promoters hold 69.80% of the KSB Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of KSB Ltd vs industry peers?
KSB Ltd revenue CAGR is 17.41%, compared to the industry median CAGR of 14.24%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 6.4 14.2
Gross Profit Growth (%) 16 18.9
Operating Profit Growth (%) 10.7 20.5
Net Profit Growth (%) 9.5 20.9
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.11 1
ROE (%) 17.41 15
ROCE (%) 23.41 19.99
Cash Conversion Cycle (days) 127.63 92

Valuation & price assessment

Q.1 Stock return of KSB Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 19.7% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
19.7% 33.4% 23.7% 2.9%
Q.2 Valuation ratios of KSB Ltd vs historical?
The current P/E ratio of 56.37 is higher than its historical median of 48.92, 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 56.37 48.92 37.40
Price to Book 8.64 8.20 5.31
Price to Sales 5.27 4.71 3.28
EV to EBITDA 32.92 29.84 22.66

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