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INVESTMENT INSIGHTS

Check Before You Invest : Nirlon Ltd

BSE: 500307 NSE: NIRLON ISIN: INE910A01012
  |   Sector:  Construction & Infrastructure   |   Industry:  Engineering - Construction

Snapshot

Q.1 Which industry/sub-sector does Nirlon Ltd belong to?
Nirlon Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.
Q.2 Is Nirlon Ltd a good quality company?
Nirlon Ltd is a good quality company, based on a consistently good 10 year financial track record.
Q.3 Is Nirlon Ltd undervalued or overvalued?
Nirlon Ltd appears Fair, as its key valuation ratios are in line with their past averages.
Q.4 Is Nirlon Ltd a good buy now?
Nirlon 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 Nirlon Ltd?
Nirlon Ltd revenue growth is 5.5% for FY-2025 , which is below its 5 year CAGR of 15.5% , indicating slower growth.
Q.2 Gross Profit margin of Nirlon Ltd?
Nirlon Ltd Gross profit margin which is the profit after deduction of direct costs, is 62.1% for FY-2025 , which is in line with its 5 year median of 62.1% , indicating stable margins.
Q.3 Operating Profit Margin of Nirlon Ltd?
Nirlon Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 79.15% for FY-2025 , which is above its 5 year median of 79.12% indicating increasing margins.
Q.4 Net Profit Margin of Nirlon Ltd?
Nirlon Ltd Net Profit Margin is 34.3% for FY-2025 , is above with its 5 year median of 34.08%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 62.1 62.1
Operating Profit Margin 79.15 79.12
Net Profit Margin 34.3 34.08
Q.5 Return on Asset of Nirlon Ltd?
Nirlon Ltd Return on Asset is 9.99%, which is above its 5 year historical median of 7.12%, indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of Nirlon Ltd?
Nirlon Ltd Return on equity is 59.78% for FY-2025 , which is above its historical median of 35.9%, indicating the business is making better use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Nirlon Ltd?
Nirlon Ltd Return on capital employed is 30.14% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 14%, indicating value creation.
Q.8 Cash conversion cycle of Nirlon Ltd?
Nirlon Ltd Cash conversion cycle is -42 days, above its historical median of -42 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 0.29 0.26
ROE 59.78 35.9
ROCE 30.14 22.37
Cash Conversion Cycle -42 days -42 days
Q.9 Debt to Equity ratio of Nirlon Ltd?
Nirlon Ltd Debt-to-Equity ratio is 3.21 , which is above with the industry average of 0.38 , indicating higher debt levels in the industry.
Q.10 Debt to cash flow from operations of Nirlon Ltd?
Nirlon Ltd Debt to cash flow from operations is 2.39 , which is at a moderate level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Nirlon Ltd?
Promoters hold 67.67% of the Nirlon Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Nirlon Ltd vs industry peers?
Nirlon Ltd revenue CAGR is 15.46% , compared to the industry median CAGR of 0% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 636.1 103.6
Gross Profit 395 5.2
Operating Profit 503 6
Net Profit 218 2.6
Operating Efficiency
Current Level Industry Median
Asset Turnover 0.29 0.63
ROE 59.78 6.64
ROCE 30.14 11.13
Cash Conversion Cycle (days) -42.07 51

Valuation & price assessment

Q.1 Stock return of Nirlon Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 11.3% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 11.3% 14.3% 12.3% 0.1%
Q.3 Valuation ratios of Nirlon Ltd vs historical?
The current P/E is lower 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 14.66 19.11 27.03
Price to Book 9.05 4.58 1.70
Price to Sales 7.35 7.07 1.45
EV to EBITDA 10.8 13.68 11.36

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