Ahluwalia Contracts (India) Limited

Industrials — Engineering & Construction · NSE

₹555.05−₹8.20 (−1.46%)

DalalBaazaar Score

56 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:10 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

The 60-second version of Ahluwalia Contracts (India) Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Ahluwalia Contracts (India) Limited, together with its subsidiaries, operates as an engineering, procurement, and construction company in India and internationally. The company operates through Construction Contract, Lease Rental, and Others segments.

IndustryEngineering & Construction

SectorIndustrials

Employees3,978

Annual revenue₹4,525 Cr

How does it make money?

Turns over ₹4,525 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 3,978 employees supports ₹1.14 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin10.8%

Net margin5.9%

Revenue / employee₹1.14 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., ADANI PORT & SEZ LTD, SIEMENS LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

ADANI PORT & SEZ LTDP/E 29.9x · ROE 14.1%

SIEMENS LTDP/E 88.8x · ROE 10.5%

What is its competitive advantage?Some evidence

ROCE of 15.2% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE15.2%

ROE12.9%

Peer median ROE14.1%

What is the outlook?

12 analysts covering the stock expect revenue to grow about 16.9% and earnings to grow about 49.1% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+16.9%

Est. earnings growth+49.1%

Analysts12

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 +61% while net margin moved -15% 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+61%

Margin effect-15%

DalalBaazaar Score

56/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of 0.51 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings

Quality vs. Valuation

Company Quality

55/ 100

Average

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

Valuation

78/ 100

Cheap

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

16.5x

3Y Median

25.6x

40 monthly readings · mean 25.5x · range 11.5x–48.8x

Sector Median

30.1x

median of 3 sector peers

🟢Current valuation is approximately 35% below its 3y median of 25.6x. 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 45% below the peer median of 30.1x.

vs. its own history

Cheap

25.6x median over 40 months · -35%

vs. sector peers

Cheap

30.1x median of 3 peers · -45%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

16.5x

P/B

1.81x

EV/EBITDA

7.1x

PEG

1.49

Dividend Yield

0.13%

What's Good / What's Bad

🟢 What's Going Well2

Valuation below its historical average
At 16.5x the stock trades 35% below its own median of 25.6x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Debt is rising
Total debt is up 27% over 3 years — worth checking what it funded.
Return on capital is falling
ROCE has declined from 20.5% to 15.2% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 3.55x — earnings must service borrowings before shareholders see anything.
🔴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.
🟡Debt is increasingFinancial
Total debt is up 27% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 35% 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 45% 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?

Leverage amplifies any setback
Debt/Equity of 3.55x. Interest is payable whether or not the business has a good year.
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.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

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

1Revenue growth stays above 13% a year✓ 17.3% CAGR
Latest reported year was 12.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 9%✓ 10.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹15 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 12%✓ 15.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

4 good · 5 neutral · 2 weak

Market Cap

₹3,718 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

16.5x

Fair

Fairly valued against the generic band

P/B Ratio

1.81x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹33.59

Profitable

Profitable on a per-share basis

ROE

12.9%

Moderate

Moderate capital efficiency

ROCE

15.2%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

3.55x

High

High leverage

Revenue Growth (YoY)

12.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-79.7%

Falling

Profits are shrinking

Dividend Yield

0.13%

Modest

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

Free Cash Flow

₹15 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹555.05

P/E (Forward)

11.7x

Improving

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

Operating Margin

1.4%

Weak

Thin margins leave little room for error

Net Margin

4.8%

Average

Average bottom-line conversion

Current Ratio

1.89

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.51

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

568.5 / 634.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

38.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,805 Cr	₹3,855 Cr	₹4,073 Cr	₹4,525 Cr	+17.3%
EBITDA	₹323 Cr	₹406 Cr	₹392 Cr	₹490 Cr	+14.9%
EBITDA Margin	11.5%	10.5%	9.6%	10.8%	—
PAT (Net Profit)	₹194 Cr	₹375 Cr	₹202 Cr	₹266 Cr	+11.1%
EPS	₹28.96	₹55.95	₹30.17	₹39.69	+11.1%
ROE	15.8%	23.4%	11.2%	12.9%	—
ROCE	20.5%	27.0%	13.7%	15.2%	—
Total Debt	₹58 Cr	₹105 Cr	₹76 Cr	₹73 Cr	+8.2%
Free Cash Flow	₹195 Cr	₹143 Cr	₹171 Cr	₹15 Cr	-57.3%

🟢 Revenue has grown at 17.3% a year over 3 years.

🟢 EBITDA has grown at 14.9% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 10.8% over 3 years.

🟢 PAT (Net Profit) has grown at 11.1% a year over 3 years.

🟢 EPS has grown at 11.1% a year over 3 years.

🔴 ROE has fallen from 15.8% to 12.9% over 3 years (-2.9 pts).

🔴 ROCE has fallen from 20.5% to 15.2% over 3 years (-5.3 pts).

🔴 Total Debt has grown at 8.2% a year over 3 years.

🔴 Free Cash Flow has shrunk at 57.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,266 Cr

Total Liabilities

₹2,206 Cr

Total Debt

₹73 Cr

Cash & Equivalents

₹308 Cr

Operating Cash Flow

₹281 Cr

Capex

-₹266 Cr

Shareholding (proxy)

Institutional Holding

33.5%

Insider Holding

55.4%

Corporate Actions

Dividend Rate

₹0.7

Ex-Dividend Date

22 Sept 2026

Analyst Consensus

Recommendations

7 Buy · 2 Hold · 3 Sell

Target Price (Mean)

₹832.38

+50.0% vs CMP

Target Range

₹600 – ₹1,170

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
ADANI PORT & SEZ LTD	29.9x	14.1%
SIEMENS LTD	88.8x	10.5%

Recent News

2 mixed4 general

Is Ahluwalia Contracts the Best Stock in Its Sector? A Look at the Numbers

Univest, 14 Oct

Caught Out By Ahluwalia's Slide? Here's What The Bears Saw

Simply Wall Street, 09 Oct

Earnings call transcript: Ahluwalia Contracts posts Q1 FY27 miss as margins shrink

Investing.com, 17 AugResults

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

Ahluwalia Contracts (India) Limited (AHLUCONT.NS) Slips 0.79% to ₹547.2, Holds Above Key Support Zone - Breakaway Gap

https://www.siam.in/, 30 Sept

AHLUCONT Forecast — Price Target — Prediction for 2027

TradingView, 25 JunAnalyst view

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

Buy Ahluwalia Contracts India; target of Rs 1009: Anand Rathi

Moneycontrol.com, 04 Jun

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🔴Business QualityWeak8.8/20

🟢Financial HealthStrong13.9/20

🟡GrowthModest11.6/20

🔴ProfitabilityWeak6.5/15

🟢ValuationAttractive10.7/15

🔴RiskHigh4.3/10

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 13% a year17.3% CAGR
✓EBITDA margin holds above 9%10.8%
✓Free cash flow remains positive₹15 Cr
✓Debt / EBITDA stays below 2x0.1x
✓ROCE stays above 12%15.2%