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Check Before You Invest : Tipco Engineering India Ltd

BSE: 544740 NSE: ISIN: INE1U6D01014
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering - Industrial Equipments

Snapshot

Q.1 Which industry/sub-sector does Tipco Engineering India Ltd belong to?
Tipco Engineering India Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering - Industrial Equipments segment.
Q.2 Is Tipco Engineering India Ltd a good quality company?
Tipco Engineering India Ltd is a weak quality company, based on a inconsistent 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 Tipco Engineering India Ltd undervalued or overvalued?
Tipco Engineering India 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 3-year
Historic Median
Price to Earnings 19.65 15.08
Price to Book 3.14 2.52
Price to Sales 2.29 1.76
EV to EBITDA 14.15 11.21
Q.4 Is Tipco Engineering India Ltd a good buy now?
Tipco Engineering India 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.

Q.1 Gross Profit margin of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Gross profit margin which is the profit after deduction of direct costs, is 14.6% for FY-2025, which is above its 3-year median of 10.6%, indicating increasing margins.

Q.2 Operating Profit Margin of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 17.91% for FY-2025, which is above its 3-year median of 12% indicating increasing margins.

Q.3 Net Profit Margin of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Net Profit Margin is 11.64% for FY-2025, is above its 3-year median of 8.32%, indicating increasing margins.
Current Level 3-year
Historic Median
Gross Profit Margin (%) 14.6 10.6
Operating Profit Margin (%) 17.91 12
Net Profit Margin (%) 11.64 8.32

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Return on Asset is 18.67%, which is in line with its 3-year historical median of 17.98%, indicating stable asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Return on capital employed is 43.16% for FY-2025, which is in line with its 3-year historical median of 43.16%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.6 Return on Equity (ROE) of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Return on equity is 68.03% for FY-2025, which is below its 3-year historical median of 99.75%, indicating the business is making worse use of its shareholders capital.

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

Q.7 Debt to Equity ratio of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Debt-to-Equity ratio is 1.13, which is above the industry average of 0.18, indicating higher debt levels in the industry.

Q.8 Debt to cash flow from operations of Tipco Engineering India Ltd?
Tipco Engineering India Ltd Debt to cash flow from operations is 2.28, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Tipco Engineering India Ltd?

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

Peer comparison (industry-wise, mcap)

E: How does Tipco Engineering India Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Tipco Engineering India Ltd vs industry peers?
Tipco Engineering India Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 13.52%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 3-year
Industry Median
Revenue Growth (%) - 13.5
Gross Profit Growth (%) 72.7 26
Operating Profit Growth (%) 100 26
Net Profit Growth (%) 87.5 26
Operating Efficiency
Current Level 3-year
Industry Median
Asset Turnover (x) 1.6 0.92
ROE (%) 68.03 15.77
ROCE (%) 43.16 19.26
Cash Conversion Cycle (days) 77.99 99

Valuation & price assessment

Q.1 Stock return of Tipco Engineering India Ltd over the last decade?
Over the last - year(s), the stock has delivered a CAGR of N/A% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - -
Q.2 Valuation ratios of Tipco Engineering India Ltd vs historical?
The current P/E ratio of 19.65 is higher than its historical median of 15.08, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 3-year historical median and industry numbers?
Valuation Ratios Current 3-year
Historic Median
3-year
Industry Median
Price to Earnings 19.65 15.08 32.30
Price to Book 3.14 2.52 3.57
Price to Sales 2.29 1.76 3.21
EV to EBITDA 14.15 11.21 16.34

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