Check Before You Invest : Eicher Motors Ltd

Snapshot

Q.1 Which industry/sub-sector does Eicher Motors Ltd belong to?

Eicher Motors Ltd belongs to the Automobiles sector, operating specifically within the Automobile Two & Three Wheelers segment.

Q.2 Is Eicher Motors Ltd a good quality company?

Eicher Motors Ltd is a good quality company, based on a consistently good 10-year financial track record.

Q.3 Is Eicher Motors Ltd undervalued or overvalued?

Eicher Motors Ltd appears Somewhat overvalued, as its key valuation ratios are above with their past averages.

Q.4 Is Eicher Motors Ltd a good buy now?

Eicher Motors Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Eicher Motors Ltd?

Eicher Motors Ltd revenue growth is 14.1% for FY-2025, which is below its 5-year CAGR of 15.57%, indicating slower growth.

Q.2 Return on capital employed (ROCE) of Eicher Motors Ltd?

Eicher Motors Ltd Return on capital employed is 30.02% for FY-2025, which is above its 5-year historical median of 27.48%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.3 Return on Asset of Eicher Motors Ltd?

Eicher Motors Ltd Return on Asset is 18.83%, which is above its 5-year historical median of 16.49%, indicating improved asset utilization efficiency.

Q.4 Return on Equity (ROE) of Eicher Motors Ltd?

Eicher Motors Ltd Return on equity is 24.18% for FY-2025, which is above its 5-year historical median of 21.19%, indicating the business is making better use of its shareholders capital.

Q.5 Cash conversion cycle of Eicher Motors Ltd?

Eicher Motors Ltd Cash conversion cycle is -21 days, in line with its 5-year historical median of -21 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover	0.76	0.76
ROE	24.18	21.19
ROCE	30.02	27.48
Cash Conversion Cycle	-21 days	-21 days

Q.6 Gross Profit margin of Eicher Motors Ltd?

Eicher Motors Ltd Gross profit margin which is the profit after deduction of direct costs, is 31.4% for FY-2025, which is above its 5-year median of 27.6%, indicating increasing margins.

Q.7 Operating Profit Margin of Eicher Motors Ltd?

Eicher Motors Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.03% for FY-2025, which is in line with its 5-year median of 23.86% indicating stable margins.

Q.8 Net Profit Margin of Eicher Motors Ltd?

Eicher Motors Ltd Net Profit Margin is 25.09% for FY-2025, is above with its 5-year median of 20.18%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin	31.4	27.6
Operating Profit Margin	25.03	23.86
Net Profit Margin	25.09	20.18

Q.9 Debt to Equity ratio of Eicher Motors Ltd?

Eicher Motors Ltd Debt-to-Equity ratio is 0.01, which is lower with the industry average of 0.17, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Eicher Motors Ltd?

Eicher Motors Ltd Debt to cash flow from operations is 0.07, which is at a healthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Eicher Motors Ltd?

Promoters hold 49.06% of the Eicher Motors Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Eicher Motors Ltd vs industry peers?

Eicher Motors Ltd revenue CAGR is 15.57%, compared to the industry median CAGR of 13.41%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	14.1	13.4
Gross Profit Growth	11.4	14.5
Operating Profit Growth	8.9	16.1
Net Profit Growth	18.3	14

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	0.76	1.27
ROE	24.18	21.4
ROCE	30.02	27.11
Cash Conversion Cycle (days)	-21.08	-20

Valuation & price assessment

Q.1 Stock return of Eicher Motors Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 13.7% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	13.7%	24.7%	28.8%	31.1%

Q.3 Valuation ratios of Eicher Motors Ltd vs historical?

The current P/E is higher that its historical median.

Q.4 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	36.41	34.54	22.22
Price to Book	8.36	6.99	4.64
Price to Sales	8.8	7.96	3.29
EV to EBITDA	27.69	24.83	16.38

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