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Check Before You Invest : RIR Power Electronics Ltd

BSE: 517035 NSE: ISIN: INE302D01024
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Electronics - Components

Snapshot

Q.1 Which industry/sub-sector does RIR Power Electronics Ltd belong to?
RIR Power Electronics Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Electronics - Components segment.
Q.2 Is RIR Power Electronics Ltd a good quality company?
RIR Power Electronics Ltd is a average quality company, based on a somewhat consistent 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 RIR Power Electronics Ltd undervalued or overvalued?
RIR Power Electronics 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 198.73 83.08
Price to Book 11.18 11.03
Price to Sales 16.77 8.51
EV to EBITDA 113.35 45.73
Q.4 Is RIR Power Electronics Ltd a good buy now?
RIR Power Electronics 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 RIR Power Electronics Ltd?
RIR Power Electronics Ltd revenue growth is 29.1% for FY-2025, which is above its 5-year CAGR of 20.75%, indicating faster growth.

Q.2 Gross Profit margin of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Gross profit margin which is the profit after deduction of direct costs, is 13.9% for FY-2025, which is in line with its 5-year median of 13.9%, indicating stable margins.

Q.3 Operating Profit Margin of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.22% for FY-2025, which is in line with its 5-year median of 13.22% indicating stable margins.

Q.4 Net Profit Margin of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Net Profit Margin is 9.6% for FY-2025, is in line with its 5-year median of 9.6%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 13.9 13.9
Operating Profit Margin (%) 13.22 13.22
Net Profit Margin (%) 9.6 9.6

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Return on Asset is 6.75%, which is below its 5-year historical median of 7.27%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Return on capital employed is 12.15% for FY-2025, which is below its 5-year historical median of 14.93%. 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 RIR Power Electronics Ltd?
RIR Power Electronics Ltd Return on equity is 10.75% for FY-2025, which is below its 5-year historical median of 11.68%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Cash conversion cycle is 117 days, below its 5-year historical median of 153 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) 0.7 0.92
ROE (%) 10.75 11.68
ROCE (%) 12.15 14.93
Cash Conversion Cycle 117 days 153 days

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

Q.9 Debt to Equity ratio of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Debt-to-Equity ratio is 0.11, which is lower the industry average of 0.25, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of RIR Power Electronics Ltd?
RIR Power Electronics Ltd Debt to cash flow from operations is 3.02, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of RIR Power Electronics Ltd?

Q.1 Promoter shareholding and pledge status of RIR Power Electronics Ltd?
Promoters hold 58.61% of the RIR Power Electronics Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does RIR Power Electronics Ltd performance compare with that of its Peers?

Q.1 Revenue growth of RIR Power Electronics Ltd vs industry peers?
RIR Power Electronics Ltd revenue CAGR is 20.75%, compared to the industry median CAGR of 3.03%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 29.1 3
Gross Profit Growth (%) - 16
Operating Profit Growth (%) 10 19.2
Net Profit Growth (%) - 16.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.7 0.79
ROE (%) 10.75 7.33
ROCE (%) 12.15 9.29
Cash Conversion Cycle (days) 117.25 121

Valuation & price assessment

Q.1 Stock return of RIR Power Electronics Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 56.9% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
56.9% 106.1% 71.1% 2.3%
Q.2 Valuation ratios of RIR Power Electronics Ltd vs historical?
The current P/E ratio of 198.73 is higher than its historical median of 83.08, 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 198.73 83.08 37.32
Price to Book 11.18 11.03 3.80
Price to Sales 16.77 8.51 4.16
EV to EBITDA 113.35 45.73 22.30

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