Check Before You Invest : Patel Engineering Ltd

Q: Which industry/sub-sector does Patel Engineering Ltd belong to?

Patel Engineering Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.

Q: Is Patel Engineering Ltd a good quality company?

Patel Engineering Ltd is a average quality company, based on a somewhat consistent 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: Is Patel Engineering Ltd undervalued or overvalued?

Patel Engineering Ltd appears Somewhat Undervalued, as its key valuation ratios are lower 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. Price to Earnings, Current: 9.56, Historic Median: 11.49. Price to Book, Current: 0.58, Historic Median: 0.84. Price to Sales, Current: 0.5, Historic Median: 0.62. EV to EBITDA, Current: 3.79, Historic Median: 5.43

Q: Is Patel Engineering Ltd a good buy now?

Patel Engineering 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

Q: Revenue growth of Patel Engineering Ltd?

Patel Engineering Ltd revenue growth is 5.1% for FY-2025, which is below its 5-year CAGR of 13.03%, indicating slower growth.

Q: Gross Profit margin of Patel Engineering Ltd?

Patel Engineering Ltd Gross profit margin which is the profit after deduction of direct costs, is 12.2% for FY-2025, which is above its 5-year median of 7.1%, indicating increasing margins.

Q: Operating Profit Margin of Patel Engineering Ltd?

Patel Engineering Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 15.88% for FY-2025, which is in line with its 5-year median of 15.38% indicating stable margins.

Q: Net Profit Margin of Patel Engineering Ltd?

Patel Engineering Ltd Net Profit Margin is 5.01% for FY-2025, is above its 5-year median of 3.84%, indicating increasing margins. Profitability Metrics. Gross Profit Margin (%), Current: 12.2, Historic Median: 7.1. Operating Profit Margin (%), Current: 15.88, Historic Median: 15.38. Net Profit Margin (%), Current: 5.01, Historic Median: 3.84

Q: Return on Asset of Patel Engineering Ltd?

Patel Engineering Ltd Return on Asset is 2.53%, which is above its 5-year historical median of 1.69%, indicating improved asset utilization efficiency.

Q: Return on capital employed (ROCE) of Patel Engineering Ltd?

Patel Engineering Ltd Return on capital employed is 12.61% for FY-2025, which is in line with its 5-year historical median of 12.61%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Check Before You Invest : Patel Engineering Ltd

Snapshot

Q.1 Which industry/sub-sector does Patel Engineering Ltd belong to?

Patel Engineering Ltd belongs to the Construction & Infrastructure sector, operating specifically within the Engineering - Construction segment.

Q.2 Is Patel Engineering Ltd a good quality company?

Patel Engineering Ltd is a average quality company, based on a somewhat consistent 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 Patel Engineering Ltd undervalued or overvalued?

Patel Engineering Ltd appears Somewhat Undervalued, as its key valuation ratios are lower 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	9.56	11.49
Price to Book	0.58	0.84
Price to Sales	0.5	0.62
EV to EBITDA	3.79	5.43

Q.4 Is Patel Engineering Ltd a good buy now?

Patel Engineering 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

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 Patel Engineering Ltd?

Patel Engineering Ltd revenue growth is 5.1% for FY-2025, which is below its 5-year CAGR of 13.03%, indicating slower growth.

Q.2 Gross Profit margin of Patel Engineering Ltd?

Patel Engineering Ltd Gross profit margin which is the profit after deduction of direct costs, is 12.2% for FY-2025, which is above its 5-year median of 7.1%, indicating increasing margins.

Q.3 Operating Profit Margin of Patel Engineering Ltd?

Patel Engineering Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 15.88% for FY-2025, which is in line with its 5-year median of 15.38% indicating stable margins.

Q.4 Net Profit Margin of Patel Engineering Ltd?

Patel Engineering Ltd Net Profit Margin is 5.01% for FY-2025, is above its 5-year median of 3.84%, indicating increasing margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	12.2	7.1
Operating Profit Margin (%)	15.88	15.38
Net Profit Margin (%)	5.01	3.84

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Patel Engineering Ltd?

Patel Engineering Ltd Return on Asset is 2.53%, which is above its 5-year historical median of 1.69%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Patel Engineering Ltd?

Patel Engineering Ltd Return on capital employed is 12.61% for FY-2025, which is in line with its 5-year historical median of 12.61%. 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 Patel Engineering Ltd?

Patel Engineering Ltd Return on equity is 6.96% for FY-2025, which is above its 5-year historical median of 5.59%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Patel Engineering Ltd?

Patel Engineering Ltd Cash conversion cycle is 178 days, below its 5-year historical median of 245 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)	0.5	0.44
ROE (%)	6.96	5.59
ROCE (%)	12.61	12.61
Cash Conversion Cycle	178 days	245 days

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

Q.9 Debt to Equity ratio of Patel Engineering Ltd?

Patel Engineering Ltd Debt-to-Equity ratio is 0.43, which is above the industry average of 0.38, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Patel Engineering Ltd?

Patel Engineering Ltd Debt to cash flow from operations is 4.41, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Patel Engineering Ltd?

Q.1 Promoter shareholding and pledge status of Patel Engineering Ltd?

Promoters hold 31.48% of the Patel Engineering Ltd, with 86.58% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

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

Q.1 Revenue growth of Patel Engineering Ltd vs industry peers?

Patel Engineering Ltd revenue CAGR is 13.03%, 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 (%)	5.1	-
Gross Profit Growth (%)	38.4	17
Operating Profit Growth (%)	6.2	14
Net Profit Growth (%)	-21.9	20.3

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	0.5	0.63
ROE (%)	6.96	6.16
ROCE (%)	12.61	10.5
Cash Conversion Cycle (days)	177.62	52

Valuation & price assessment

Q.1 Stock return of Patel Engineering Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of -2.6% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	-2.6%	14.7%	2.2%	-35.9%

Q.2 Valuation ratios of Patel Engineering Ltd vs historical?

The current P/E ratio of 9.56 is lower than its historical median of 11.49, indicating that the stock is trading below 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	9.56	11.49	21.52
Price to Book	0.58	0.84	1.74
Price to Sales	0.5	0.62	1.51
EV to EBITDA	3.79	5.43	11.49

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Check Before You Invest : Patel Engineering Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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