Varroc Engineering Ltd - Stock Valuation and Financial Performance

BSE: 541578 | NSE: VARROC | Auto Ancillary | Small Cap

Varroc Engineering Share Price

511.25 9.85 1.96%
as on 28-Mar'24 16:00

DeciZen - make an informed investing decision on Varroc Engineering

Overall Rating
Bole Toh

1. Quality

2. Valuation

Fair

3. Price Trend

Semi Strong

Varroc Engineering stock performance -

mw4me loader
P/E Ratio (CD):
15.06
Market Cap:
7,660.7 Cr.
52-wk low:
239.8
52-wk high:
631

Is Varroc Engineering Ltd an attractive stock to invest in?

1. Is Varroc Engineering Ltd a good quality company?

Past 10 year’s financial track record analysis by Moneyworks4me indicates that Varroc Engineering Ltd is a below average quality company.

2. Is Varroc Engineering Ltd undervalued or overvalued?

The key valuation ratios of Varroc Engineering Ltd's currently when compared to its past seem to suggest it is in the Fair zone.

3. Is Varroc Engineering Ltd a good buy now?

The Price Trend analysis by MoneyWorks4Me indicates it is Semi Strong which suggest that the price of Varroc Engineering Ltd is likely to Rise-somewhat in the short term. However, please check the rating on Quality and Valuation before investing.

10 Year X-Ray of Varroc Engineering:

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end.

Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Varroc Engineering Ltd has not performed well majority of the past ten years indicating its past ten year financial track record is not good

Value Creation

Value Creation Index Colour Code Guide

Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23TTM
ROCE % 6%9.9%12.8%9.4%13.6%10.4%1.1%-8.4%0.1%5.7%-
Value Creation
Index
-0.6-0.3-0.1-0.30.0-0.2-0.9-1.6-1.0-0.6-

Growth Parameters

Growth Parameters Colour Code Guide

Sales 6,1166,7707,9099,29910,27912,03611,12211,3035,8446,8637,254
Sales YoY Gr.-10.7%16.8%17.6%10.5%17.1%-7.6%1.6%-48.3%17.4%-
Adj EPS 5.3-9.134.723.73832-2.3-42-52.833.3
YoY Gr.--272.1%NA-31.7%60.3%-15.9%-107.2%NANANA-
BVPS (₹) 101.8112.6181.6190.5229.6227.5222.9198.2130.263.991.2
Adj Net
Profit
55.5-87.7334272468431-31-642-76.342.4509
Cash Flow from Ops. 4601282906771,0754741,414474636661-
Debt/CF from Ops. 2.412.95.52.21.15.22.56.32.42.5-

CAGR

CAGR Colour Code Guide

9 Years 5 Years 3 Years 1 Years
Sales 1.3%-7.8%-14.9%17.4%
Adj EPS -7%-40.8%NANA
BVPS-5%-22.6%-34.1%-50.9%
Share Price - -2.5% 10.2% 110.7%

Key Financial Parameters

Performance Ratio Colour Code Guide

Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23TTM
Return on
Equity %
6.2-8.123.513.818.714.6-1-21.3-32.942.9
Op. Profit
Mgn %
6.99.17.26.38.88.97.43.66.38.39.3
Net Profit
Mgn %
0.9-1.24.22.94.63.6-0.3-5.7-1.30.77
Debt to
Equity
11.50.90.70.40.81.210.81.7-
Working Cap
Days
99102999295971111151638244
Cash Conv.
Cycle
1922241563-3-4-8-4-23

Recent Performance Summary

Return on Equity has increased versus last 3 years average to 42.90%

Sales growth has been subdued in last 3 years -14.86%

Net Profit has been subdued in last 3 years 0.00%

Debt to equity has increased versus last 3 years average to 1.67

Sales growth is not so good in last 4 quarters at 6.16%

Latest Financials - Varroc Engineering Ltd.

Standalone Consolidated
TTM EPS (₹) 17.4 33.3
TTM Sales (₹ Cr.) 4,264 7,254
BVPS (₹.) 55.5 91.2
Reserves (₹ Cr.) 832 1,378
P/BV 9.04 5.50
PE 28.91 15.06
From the Market
52 Week Low / High (₹) 239.80 / 631.00
All Time Low / High (₹) 119.20 / 1177.45
Market Cap (₹ Cr.) 7,661
Equity (₹ Cr.) 15.3
Face Value (₹) 1
Industry PE 46.3

Management X-Ray of Varroc Engineering:

Shareholding Pattern

Promoter's Holding & Share Pledging

Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)

Event Update

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Analyst's Notes

Key Ratios of Varroc Engineering

Adj EPS (Rs.)

Sales (Cr.)

ROE (%)

ROCE (%)

Profit And Loss

(All Figures are in Crores.)
PARTICULARSMar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23
Sales6,1166,7707,9099,29910,27912,03611,12211,3035,8446,863
Operating Expenses 5,7176,1537,3388,7179,39810,97810,30110,9065,4856,316
Manufacturing Costs6636677999081,0861,136946931680784
Material Costs3,5994,1935,0496,0376,3837,5766,9867,5123,8494,431
Employee Cost 9379021,0401,2041,3141,5011,6371,630619717
Other Costs 517391450569616765731834336385
Operating Profit 4006175715828811,059821397359547
Operating Profit Margin (%) 6.5%9.1%7.2%6.3%8.6%8.8%7.4%3.5%6.1%8.0%
Other Income 2388148943991991273458
Interest 10147584908697139163118190
Depreciation 238254292337386566732895305337
Exceptional Items 088500000000
Profit Before Tax 846339232751651939-498-3083
Tax 414722146590371304844
Profit After Tax 43173703134514293-629-7839
PAT Margin (%) 0.7%0.2%4.7%3.4%4.4%3.6%0.0%-5.6%-1.3%0.6%
Adjusted EPS (₹)4.01.438.427.336.631.50.0-41.4-72.6-53.7
Dividend Payout Ratio (%)2%21%1%1%1%13%0%0%0%0%

Balance Sheet

(All Figures are in Crores.)
PARTICULARSMar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23

Equity and Liabilities

Shareholders Fund 1,0951,0821,7632,1852,8283,0663,0053,0281,989976
Share Capital 40102613131313151515
Reserves 1,0541,0731,7372,1722,8153,0532,9913,0131,973961
Minority Interest31212020212425282528
Debt8711,4061,4051,3549801,6592,6011,758394678
Long Term Debt6371,023763755636457900936250416
Short Term Debt2353836425993441,2011,700822144262
Trade Payables1,1401,0291,2691,5502,0002,0562,3803,0311,3341,196
Others Liabilities 8298897757389201,7432,7743,2027,2471,735
Total Liabilities 3,9664,4285,2335,8476,7498,54810,78411,04710,9894,614

Fixed Assets

Gross Block4,2552,0842,3922,9743,8205,0987,2888,0363,5643,934
Accumulated Depreciation2,7452412815931,0301,5512,0052,8051,5301,883
Net Fixed Assets1,5091,8432,1112,3812,7903,5465,2835,2312,0332,051
CWIP 319177315293344999790856140135
Investments 104234291293360362330376388421
Inventories7785866837538648901,0761,256616671
Trade Receivables7731,0711,1851,1381,4031,3501,0891,641518597
Cash Equivalents 256691773543291631,069745118327
Others Assets2274484706356601,2371,1479417,177412
Total Assets 3,9664,4285,2335,8476,7498,54810,78411,04710,9894,614

Cash Flow

(All Figures are in Crores.)
PARTICULARSMar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23
Cash Flow From Operating Activity 4601282906771,0754741,414474636661
PBT 846339232751651939-498-1,065-773
Adjustment 3426291913313875748889321,1781,232
Changes in Working Capital 96-506-25270299-49161560596293
Tax Paid -63-57-40-51-127-128-128-20-74-92
Cash Flow From Investing Activity -341-245-579-565-601-1,757-1,268-644-763-260
Capex -275-351-599-624-578-1,425-1,387-728-844-571
Net Investments -102441234-3-3950-28283
Others 3662925-2062119867327
Cash Flow From Financing Activity -817038694-5231,129733-152-335-216
Net Proceeds from Shares 000000068500
Net Proceeds from Borrowing 0000-131357604284-137-40
Interest Paid -103-98-85-86-86-95-121-137-156-237
Dividend Paid -1-4-4-5-7-1-1150-60
Others 23172475184-299868365-985-3561
Net Cash Flow 38-4798205-50-154879-322-462185
PARTICULARSMar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21Mar'22Mar'23
Ratios
ROE (%)4.831.5726.1515.9517.9914.550.08-20.84-3.122.62
ROCE (%)8.9521.9315.6211.8315.5812.912.96-5.341.858.88
Asset Turnover Ratio1.661.661.71.731.651.581.151.040.530.88
PAT to CFO Conversion(x)10.77.530.782.162.381.1471.33N/AN/A16.95
Working Capital Days
Receivable Days48485044454240446730
Inventory Days39362827282732385834
Payable Days1059280821009711513019999

Varroc Engineering Ltd Stock News

Varroc Engineering Ltd FAQs

Company share prices are keep on changing according to the market conditions. The closing price of Varroc Engineering on 28-Mar-2024 16:00 is ₹511.2.
Market capitalization or market cap is determined by multiplying the current market price of a company's shares with the total number of shares outstanding. As of 28-Mar-2024 16:00 the market cap of Varroc Engineering stood at ₹7,660.7.
The latest P/E ratio of Varroc Engineering as of 28-Mar-2024 16:00 is 28.91.
The latest P/B ratio of Varroc Engineering as of 28-Mar-2024 16:00 is 9.04.
The 52-week high of Varroc Engineering is ₹631.0 and the 52-week low is ₹239.8.
The TTM revenue is Trailing Twelve Months sales. The TTM revenue/sales of Varroc Engineering is ₹4,264 ( Cr.) .

About Varroc Engineering Ltd

Varroc Engineering Ltd. is a global tier-1 automotive component group. It commenced operations in India with its Polymer business in 1990. it design, manufacture and supply exterior lighting systems, plastic and polymer components, electrical-electronics components, and precision metallic components to passenger car, commercial vehicle, two-wheeler, three-wheeler and off-highway vehicle (OHV) OEMs directly worldwide. It is the second largest Indian auto component group (by consolidated revenue for FY 2017) and a leading tier-1 manufacturer and supplier to Indian two-wheeler and three-wheeler OEMs (by consolidated revenue for FY 2017). It offers the best design solutions that provides its customers a competitive edge in their markets. This has helped Varroc place itself as the most preferred partner with all leading OEMs in the automotive segment across the world.

Business area of the company

The Company is focused on designing, manufacturing and supplying exterior lighting systems, plastic and polymer components, and electrical and electronics components. It also supplies precision metallic components to passenger car, commercial vehicle, two-heeler, three-wheeler and off highway vehicle (OHV). The Company's segments include Polymer, Electrical, Engine valve, Forged components, and Lighting.

Awards

  • 2014: Received the ‘New Part Development Award’ by Honda Motorcycle and Scooter India Private Limited
  • 2014: Named as one of the ‘Top 100 Companies’ in Czech Republic
  • 2014: Named as one of the ‘Top 100 Companies’ in Czech Republic
  • 2015: Won the ‘PSA Best Plant Award’
  • 2016: Awarded the ‘Emerging Manufacturing Giant’ by the honourable Chief Minister of Maharashtra, India, Mr. Devendra Fadnavis, on behalf of Indian Merchant Chambers
  • 2016: Given the ‘Supplier Quality Excellence Award’ by General Motors
  • 2016: Awarded ‘Emerging Manufacturing Giant’ by the chief minister of Maharashtra, India, Mr. Devendra Fadnavis, on behalf of Indian Merchant Chambers
  • 2017: National Safety Council awarded it for ‘Lowest average frequency accident rate and zero accident frequency rate’
  • 2017: Jaguar Land Rover bestowed it with the ‘Global Supplier of the Year Award’
  • 2017: Received the ‘FCA Innovation Award’ for Dodge Challenge Head Lamp 193
  • 2017: Won the ‘2016 General Motors Quality Excellence award
  • 2017: Claimed the ‘Ford Q1 Award’- Only 2nd lighting supplier in China to receive this award
  • 2017: Awarded for ‘Overall Performance Of The Year’ by Maruti Suzuki
  • 2017: Presented with an award for ‘Electrical and Electronics Excellence in Automotive Lighting’ by the International Centre For Automotive Technology
  • 2017: Bagged the ‘Electronics Co. Of The Year’ award by ELCINA
  • 2018: Handed the ‘Best Quality Award’ by FCA
  • 2018: Mr. Tarang Jain, Managing Director, has been inducted into the ‘Automotive Hall of Fame’ at the ET Polymers Global Conference on Plastics in Automotive
  • 2019: Varroc Polymer plant team bagged 2 OHS-India Safety Awards for Innovation and Excellence
  • 2019: Varroc’s Paper on ‘ELECTRICAL MOBIITY’ has been awarded the ‘BEST PAPER’ at the SIAT 2019
  • 2019: Varroc’s Polymer division bagged the ‘Award for Delivery Management 2018-19’ at the Annual Supplier Conference of Honda Two-wheelers Ltd.
  • 2019: Varroc’s polymer division recognized by Volvo Eicher Commercial Vehicles (VECV) with Outstanding Contribution in New Product Development award
  • 2019: Performance Award for ‘Incoming Quality Improvement’ at Suzuki Motorcycles India Pvt. Ltd.’s 2019 Suppliers’ Meet.
  • 2019: Varroc Polymer Business recognized for ‘Excellence in Delivery’ by Mahle Behr India Pvt Ltd., during their Supplier Meet 2019

Milestones

  • 1990: Began journey through Polymer business
  • 1996: Emergence of Electrical-Electronics business unit
  • 1997: Engine Valves manufacturing
  • 2000: Established as 'Supplier of Choice' for Bajaj Electronics Pvt. Ltd.
  • 2004: Emergence of Metallic Forgings business unit
  • 2005: Formed Varroc Exhaust System Pvt. Ltd. for two-wheeler & three-wheeler catalytic converters
  • 2007: Acquired first overseas company - IMES (Italy), a forging business
  • 2011: Acquired TRIOM (Italy), a hi-end lighting systems player for global two-wheelers
  • 2012: Acquired Visteon's Global PV Lighting Business
  • 2014: Received Investment by Omega TC Holdings Pte. Ltd. and Tata Capital Financial Services Limited
  • 2014: Acquired 50% stake in Varroc TYC Corporation BVI (China)
  • 2015: Signed a letter of intent with Heraeus, Germany based technology group, for catalytic converters for two-wheelers in India
  • 2015: Acquired Sa-Ba, an exterior automotive lighting company in Turkey
  • 2015: Developed Electronic Fuel-injection Technology for two-wheelers and three-wheelers in India
  • 2015: Varroc Engineering Ltd. got listed on BSE and NSE
  • 2015: Announced intention to set up two new manufacturing facilities in Chennai, India and Poland to further expand globally
  • 2019: Acquisition of 74% stake in CarIQ, a leading telematics solutions provider (August 2019)
  • 2019: Morocco and Brazil facilities started in February/March 2019.
  • 2020: Varroc Engineering’s wholly-owned subsidiary -- VarrocCorp Holding B.V., the Netherlands (VCHBV) has acquired balance 30% stake i.e. 60,000 equity shares of Varroc-Elba Electronics S.R.L (Varroc Elba) held by the other JV Partner, ELBA SA, Romania for an aggregate consideration of Euro 1.05M.
  • 2020: Varroc Engineering’s overseas Wholly Owned Subsidiary (WOS) -- Aries Mentor Holding B.V. (AMHBV) situated in Netherlands has merged with VarrocCorp Holding B.V. (VCHBV), WOS of the company with effect from March 4, 2020.
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