Ador Welding Limited

Industrials — Specialty Industrial Machinery · NSE

₹1,503.00−₹17.90 (−1.18%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:57 pm

Understanding the Business

Company site ↗

The 60-second version of Ador Welding Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Ador Welding Limited manufactures and supplies welding equipment, consumables, and automation solutions in India and internationally. The company operates in two segments, Welding, and Flares & Process Equipment.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees839

Annual revenue₹1,132 Cr

How does it make money?

Turns over ₹1,132 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 839 employees supports ₹1.35 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.35 Cr

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, LARSEN & TOUBRO LTD., HAVELLS INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 20.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 14.8% against a peer median of 17.1% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE17.1%

What is the outlook?

1 analysts covering the stock expect revenue to grow about 14.5% and earnings to grow about 27.0% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.5%

Est. earnings growth+27.0%

Analysts1

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +47% while net margin moved -6% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+47%

Margin effect-6%

DalalBaazaar Score

66/ 100

Good

Weighted across six categories. Every point is explained below.

• ROE of 14.8% is moderate
✗ ROE has fallen by 3.5 points over the period

Quality vs. Valuation

Company Quality

66/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

66/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

23.1x

3Y Median

30.5x

40 monthly readings · mean 28.7x · range 16.8x–41.9x

Sector Median

66.2x

median of 4 sector peers

🟢Current valuation is approximately 24% below its 3y median of 30.5x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 65% below the peer median of 66.2x.

vs. its own history

Cheap

30.5x median over 40 months · -24%

vs. sector peers

Cheap

66.2x median of 4 peers · -65%

vs. generic bands

Fair

15x–35x

EV/EBITDA

17.1x

PEG

2.02

What's Good / What's Bad

🟢 What's Going Well4

Debt is being paid down
Total debt is down 83% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
High return on capital employed
ROCE of 20.3% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 18.3% to 14.8% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 24.6% to 20.3% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 1 high · 2 watch

🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Receivables growing faster than salesFinancial
Receivables up 85% against revenue up 47% — sales are being booked faster than they are collected.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 28% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 20.3% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Deleveraging frees up earnings
Debt is down 83% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Priced below its own history
The stock trades 24% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 65% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 85% against revenue up 47%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 18.3% to 14.8%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 10% a year✓ 13.7% CAGR
Latest reported year was 22.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 13.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹94 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 17%✓ 20.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

6 good · 5 neutral · 0 weak

Market Cap

₹2,616 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

23.1x

Fair

Fairly valued against the generic band

P/B Ratio

4.72x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹65.14

Profitable

Profitable on a per-share basis

ROE

14.8%

Moderate

Moderate capital efficiency

ROCE

20.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.53x

Low

Conservative leverage

Revenue Growth (YoY)

22.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

36.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.53%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹94 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

18.4x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

9.9%

Average

Average margins

Net Margin

9.5%

Average

Average bottom-line conversion

Current Ratio

2.14

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.55

Defensive

Steadier than the market

52W Range Position

71%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1560.6 / 1579.2

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

32.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹771 Cr	₹1,068 Cr	₹1,118 Cr	₹1,132 Cr	+13.7%
EBITDA	₹94 Cr	₹134 Cr	₹121 Cr	₹150 Cr	+17.0%
EBITDA Margin	12.2%	12.5%	10.9%	13.3%	—
PAT (Net Profit)	₹59 Cr	₹86 Cr	₹60 Cr	₹82 Cr	+11.4%
EPS	₹43.6	₹49.69	₹34.51	₹47.06	+2.6%
ROE	18.3%	18.3%	11.8%	14.8%	—
ROCE	24.6%	25.0%	17.5%	20.3%	—
Total Debt	₹17 Cr	₹45 Cr	₹2 Cr	₹3 Cr	-44.5%
Free Cash Flow	-₹1 Cr	₹15 Cr	₹96 Cr	₹94 Cr	—

🟢 Revenue has grown at 13.7% a year over 3 years.

🟢 EBITDA has grown at 17.0% a year over 3 years.

🟢 EBITDA Margin has risen from 12.2% to 13.3% over 3 years (+1.1 pts).

🟢 PAT (Net Profit) has grown at 11.4% a year over 3 years.

🟢 EPS has grown at 2.6% a year over 3 years.

🔴 ROE has fallen from 18.3% to 14.8% over 3 years (-3.5 pts).

🔴 ROCE has fallen from 24.6% to 20.3% over 3 years (-4.3 pts).

🟢 Total Debt has shrunk at 44.5% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹1 Cr to ₹94 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹832 Cr

Total Liabilities

₹277 Cr

Cash & Equivalents

₹42 Cr

Operating Cash Flow

₹116 Cr

Capex

-₹22 Cr

Shareholding (proxy)

Institutional Holding

10.4%

Insider Holding

58.4%

Corporate Actions

Dividend Rate

₹23

Ex-Dividend Date

16 Jul 2026

Analyst Consensus

Recommendations

1 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,771

+17.8% vs CMP

Target Range

₹1,771 – ₹1,771

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
LARSEN & TOUBRO LTD.	30.1x	15.2%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

2 positive3 mixed1 general

ADOR Stock Price and Chart — NSE:ADOR

TradingView, 20 Jul

Ador Welding Share Price Target 2027 to 2030: Analyst Outlook

Univest, 17 AugAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Is It Smart To Buy Ador Welding Limited (NSE:ADOR) Before It Goes Ex-Dividend?

Simply Wall Street, 12 JulCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Ador Welding recommends ₹23 dividend, outlines TDS compliance

scanx.trade, 10 JunCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Ador Welding reports consolidated net profit of Rs 27.60 crore in the June 2026 quarter

Business Standard, 21 JulResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Ador Welding Stock Prediction 2026: Analyst Target, Forecast and Key Levels

Univest, 22 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Growth · Valuation

MiddlingBusiness Quality · Profitability · Risk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑