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Check Before You Invest : Eimco Elecon (India) Ltd

BSE: 523708 NSE: EIMCOELECO ISIN: INE158B01016
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering - Industrial Equipments

Snapshot

Q.1 Which industry/sub-sector does Eimco Elecon (India) Ltd belong to?
Eimco Elecon (India) Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering - Industrial Equipments segment.
Q.2 Is Eimco Elecon (India) Ltd a good quality company?
Eimco Elecon (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 Eimco Elecon (India) Ltd undervalued or overvalued?
Eimco Elecon (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 5-year
Historic Median
Price to Earnings 26.01 25.66
Price to Book 2.13 1.96
Price to Sales 4.28 3.80
EV to EBITDA 16.76 14.20
Q.4 Is Eimco Elecon (India) Ltd a good buy now?
Eimco Elecon (India) 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 Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd revenue growth is -6.4% for FY-2026, which is below its 5-year CAGR of 12.84%, indicating slower growth.

Q.2 Gross Profit margin of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Gross profit margin which is the profit after deduction of direct costs, is 25.6% for FY-2026, which is in line with its 5-year median of 25.2%, indicating stable margins.

Q.3 Operating Profit Margin of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 18.62% for FY-2026, which is above its 5-year median of 17.39% indicating increasing margins.

Q.4 Net Profit Margin of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Net Profit Margin is 16.78% for FY-2026, is in line with its 5-year median of 16.78%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 25.6 25.2
Operating Profit Margin (%) 18.62 17.39
Net Profit Margin (%) 16.78 16.78

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Return on Asset is 7.47%, which is in line with its 5-year historical median of 7.47%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Return on capital employed is 11.35% for FY-2026, which is in line with its 5-year historical median of 11.35%. 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 Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Return on equity is 8.61% for FY-2026, which is in line with its 5-year historical median of 8.61%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Cash conversion cycle is 251 days, above its 5-year historical median of 231 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.45 0.45
ROE (%) 8.61 8.61
ROCE (%) 11.35 11.35
Cash Conversion Cycle 251 days 231 days

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

Q.9 Debt to Equity ratio of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Debt-to-Equity ratio is 0.01, which is lower the industry average of 0.18, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Eimco Elecon (India) Ltd?
Eimco Elecon (India) Ltd Debt to cash flow from operations is 0.13, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Eimco Elecon (India) Ltd?

Q.1 Promoter shareholding and pledge status of Eimco Elecon (India) Ltd?
Promoters hold 48.96% of the Eimco Elecon (India) Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Eimco Elecon (India) Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Eimco Elecon (India) Ltd vs industry peers?
Eimco Elecon (India) Ltd revenue CAGR is 12.84%, compared to the industry median CAGR of 3.04%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -6.4 3
Gross Profit Growth (%) -20.3 21.9
Operating Profit Growth (%) -23.2 21.2
Net Profit Growth (%) -20.4 26.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.45 0.89
ROE (%) 8.61 12.41
ROCE (%) 11.35 15.1
Cash Conversion Cycle (days) 251.05 98

Valuation & price assessment

Q.1 Stock return of Eimco Elecon (India) Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 14.8% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
14.8% 30.4% 33.3% -24%
Q.2 Valuation ratios of Eimco Elecon (India) Ltd vs historical?
The current P/E ratio of 26.01 is in line with than its historical median of 25.66, 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 26.01 25.66 29.36
Price to Book 2.13 1.96 2.91
Price to Sales 4.28 3.80 2.93
EV to EBITDA 16.76 14.20 15.77

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