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Check Before You Invest : Techno Electric & Engineering Company Ltd

BSE: 542141 NSE: TECHNOE ISIN: INE285K01026
  |   Sector:  Construction & Infrastructure   |   Industry:  Engineering - Construction

Snapshot

Q.1 Which industry/sub-sector does Techno Electric & Engineering Company Ltd belong to?
Techno Electric & Engineering Company Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.
Q.2 Is Techno Electric & Engineering Company Ltd a good quality company?
Techno Electric & Engineering Company 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 Techno Electric & Engineering Company Ltd undervalued or overvalued?
Techno Electric & Engineering Company Ltd appears Fair, as its key valuation ratios are in line with 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 29.78 28.91
Price to Book 3.71 2.81
Price to Sales 4.99 4.47
EV to EBITDA 23.62 20.15
Q.4 Is Techno Electric & Engineering Company Ltd a good buy now?
Techno Electric & Engineering Company Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. 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 Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd revenue growth is 42.9% for FY-2025, which is above its 5-year CAGR of 22.48%, indicating faster growth.

Q.2 Gross Profit margin of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Gross profit margin which is the profit after deduction of direct costs, is 20.5% for FY-2025, which is in line with its 5-year median of 20.5%, indicating stable margins.

Q.3 Operating Profit Margin of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.72% for FY-2025, which is in line with its 5-year median of 13.72% indicating stable margins.

Q.4 Net Profit Margin of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Net Profit Margin is 15.96% for FY-2025, is in line with its 5-year median of 16.2%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 20.5 20.5
Operating Profit Margin (%) 13.72 13.72
Net Profit Margin (%) 15.96 16.2

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Return on Asset is 9.07%, which is in line with its 5-year historical median of 9.07%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Return on capital employed is 16.65% for FY-2025, which is in line with its 5-year historical median of 16.66%. 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 Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Return on equity is 12.86% for FY-2025, which is in line with its 5-year historical median of 13%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Cash conversion cycle is -20 days, below its 5-year historical median of 20 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) 0.57 0.39
ROE (%) 12.86 13
ROCE (%) 16.65 16.66
Cash Conversion Cycle -20 days 20 days

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

Q.9 Debt to Equity ratio of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.38, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Techno Electric & Engineering Company Ltd?
Techno Electric & Engineering Company Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Techno Electric & Engineering Company Ltd?

Q.1 Promoter shareholding and pledge status of Techno Electric & Engineering Company Ltd?
Promoters hold 56.92% of the Techno Electric & Engineering Company Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Techno Electric & Engineering Company Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Techno Electric & Engineering Company Ltd vs industry peers?
Techno Electric & Engineering Company Ltd revenue CAGR is 22.48%, compared to the industry median CAGR of 0%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 42.9 -
Gross Profit Growth (%) 44.2 17
Operating Profit Growth (%) 44.5 14
Net Profit Growth (%) 40.8 20.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.57 0.63
ROE (%) 12.86 6.16
ROCE (%) 16.65 10.5
Cash Conversion Cycle (days) -19.7 52

Valuation & price assessment

Q.1 Stock return of Techno Electric & Engineering Company Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 17.8% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
17.8% 31.9% 51.3% 7.9%
Q.2 Valuation ratios of Techno Electric & Engineering Company Ltd vs historical?
The current P/E ratio of 29.78 is in line with than its historical median of 28.91, indicating that the stock is trading near 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 29.78 28.91 21.52
Price to Book 3.71 2.81 1.74
Price to Sales 4.99 4.47 1.51
EV to EBITDA 23.62 20.15 11.49

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