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Check Before You Invest : Venus Pipes & Tubes Ltd

BSE: 543528 NSE: VENUSPIPES ISIN: INE0JA001018
  |   Sector:  Metals & Mining   |   Industry:  Steel & Iron Products

Snapshot

Q.1 Which industry/sub-sector does Venus Pipes & Tubes Ltd belong to?
Venus Pipes & Tubes Ltd belongs to the Metals & Mining sector, operating specifically within the Steel & Iron Products segment.
Q.2 Is Venus Pipes & Tubes Ltd a good quality company?
Venus Pipes & Tubes 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 Venus Pipes & Tubes Ltd undervalued or overvalued?
Venus Pipes & Tubes Ltd appears Fair, as its key valuation ratios are in line with 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 28.05 36.37
Price to Book 4.29 5.20
Price to Sales 2.5 3.27
EV to EBITDA 15.37 22.80
Q.4 Is Venus Pipes & Tubes Ltd a good buy now?
Venus Pipes & Tubes 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 Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd revenue growth is 19.5% for FY-2025, which is below its 5-year CAGR of 40.07%, indicating slower growth.

Q.2 Gross Profit margin of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Gross profit margin which is the profit after deduction of direct costs, is 15% for FY-2025, which is above its 5-year median of 11.5%, indicating increasing margins.

Q.3 Operating Profit Margin of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 17.49% for FY-2025, which is above its 5-year median of 12.72% indicating increasing margins.

Q.4 Net Profit Margin of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Net Profit Margin is 9.69% for FY-2025, is above its 5-year median of 8.18%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 15 11.5
Operating Profit Margin (%) 17.49 12.72
Net Profit Margin (%) 9.69 8.18

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Return on Asset is 10.39%, which is below its 5-year historical median of 13.36%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Return on capital employed is 24.99% for FY-2025, which is below its 5-year historical median of 28.45%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Return on equity is 20.07% for FY-2025, which is below its 5-year historical median of 23.61%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Cash conversion cycle is 93 days, above its 5-year historical median of 81 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) 1.07 1.44
ROE (%) 20.07 23.61
ROCE (%) 24.99 28.45
Cash Conversion Cycle 93 days 81 days

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

Q.9 Debt to Equity ratio of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Debt-to-Equity ratio is 0.37, which is above the industry average of 0.31, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Venus Pipes & Tubes Ltd?
Venus Pipes & Tubes Ltd Debt to cash flow from operations is 2.79, which is at a moderate level.

Ownership & governance

D: Promoter shareholding and pledge status of Venus Pipes & Tubes Ltd?

Q.1 Promoter shareholding and pledge status of Venus Pipes & Tubes Ltd?
Promoters hold 48.41% of the Venus Pipes & Tubes Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Venus Pipes & Tubes Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Venus Pipes & Tubes Ltd vs industry peers?
Venus Pipes & Tubes Ltd revenue CAGR is 40.07%, compared to the industry median CAGR of 7.56%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 19.5 7.6
Gross Profit Growth (%) 13.4 19.3
Operating Profit Growth (%) 15.1 13.8
Net Profit Growth (%) 8.1 24.6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.07 1.27
ROE (%) 20.07 8.04
ROCE (%) 24.99 11.28
Cash Conversion Cycle (days) 93.26 72

Valuation & price assessment

Q.1 Stock return of Venus Pipes & Tubes Ltd over the last decade?
Over the last 3 year(s), the stock has delivered a CAGR of 15.08% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - 15.1% 8.9%
Q.2 Valuation ratios of Venus Pipes & Tubes Ltd vs historical?
The current P/E ratio of 28.05 is lower than its historical median of 36.37, 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 28.05 36.37 17.36
Price to Book 4.29 5.20 1.63
Price to Sales 2.5 3.27 0.74
EV to EBITDA 15.37 22.80 10.05

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