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INVESTMENT INSIGHTS

Check Before You Invest : Aaron Industries Ltd

BSE: 0 NSE: AARON ISIN: INE721Z01010
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering - Industrial Equipments

Snapshot

Q.1 Which industry/sub-sector does Aaron Industries Ltd belong to?
Aaron Industries Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering - Industrial Equipments segment.
Q.2 Is Aaron Industries Ltd a good quality company?
Aaron Industries Ltd is a average quality company, based on a somewhat consistent 10 year financial track record.
Q.3 Is Aaron Industries Ltd undervalued or overvalued?
Aaron Industries Ltd appears Undervalued, as its key valuation ratios are below with their past averages.
Q.4 Is Aaron Industries Ltd a good buy now?
Aaron Industries 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 Aaron Industries Ltd?
Aaron Industries Ltd revenue growth is 23.3% for FY-2025 , which is below its 5 year CAGR of 29.5% , indicating slower growth.
Q.2 Gross Profit margin of Aaron Industries Ltd?
Aaron Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 17.5% for FY-2025 , which is above its 5 year median of 15.4% , indicating increasing margins.
Q.3 Operating Profit Margin of Aaron Industries Ltd?
Aaron Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 19.09% for FY-2025 , which is above its 5 year median of 17.15% indicating increasing margins.
Q.4 Net Profit Margin of Aaron Industries Ltd?
Aaron Industries Ltd Net Profit Margin is 10.58% for FY-2025 , is above with its 5 year median of 9.83%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 17.5 15.4
Operating Profit Margin 19.09 17.15
Net Profit Margin 10.58 9.83
Q.5 Return on Asset of Aaron Industries Ltd?
Aaron Industries Ltd Return on Asset is 10.19%, which is below its 5 year historical median of 10.83%, indicating deteriorated asset utilization efficiency.
Q.6 Return on Equity (ROE) of Aaron Industries Ltd?
Aaron Industries Ltd Return on equity is 20.9% for FY-2025 , which is below its historical median of 22.48%, indicating the business is making worse use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Aaron Industries Ltd?
Aaron Industries Ltd Return on capital employed is 18.59% for FY-2025 , which is above its estimated weighted average cost of capital(WACC) 14%, indicating value creation.
Q.8 Cash conversion cycle of Aaron Industries Ltd?
Aaron Industries Ltd Cash conversion cycle is 80 days, above its historical median of 80 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 0.96 1.21
ROE 20.9 22.48
ROCE 18.59 19.83
Cash Conversion Cycle 80 days 80 days
Q.9 Debt to Equity ratio of Aaron Industries Ltd?
Aaron Industries Ltd Debt-to-Equity ratio is 0.74 , which is above with the industry average of 0.18 , indicating higher debt levels in the industry.
Q.10 Debt to cash flow from operations of Aaron Industries Ltd?
Aaron Industries Ltd Debt to cash flow from operations is 3.69 , which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Aaron Industries Ltd?
Promoters hold 73.07% of the Aaron Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Aaron Industries Ltd vs industry peers?
Aaron Industries Ltd revenue CAGR is 29.50% , compared to the industry median CAGR of 2.46% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 77.9 101.1
Gross Profit 13.7 9.4
Operating Profit 15 9
Net Profit 8 6
Operating Efficiency
Current Level Industry Median
Asset Turnover 0.96 0.89
ROE 20.9 11.8
ROCE 18.59 14.41
Cash Conversion Cycle (days) 79.93 100

Valuation & price assessment

Q.1 Stock return of Aaron Industries Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 20.89% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price - 20.9% -13.5% -60%
Q.3 Valuation ratios of Aaron Industries 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 40.41 44.50 46.24
Price to Book 6.31 7.80 2.79
Price to Sales 3.29 4.33 2.66
EV to EBITDA 18.01 26.05 15.72

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