Ajax Engineering Limited

Industrials — Farm & Heavy Construction Machinery · NSE

₹561.60−₹3.00 (−0.53%)

DalalBaazaar Score

69 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with modest growth. 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, 7:47 pm

Understanding the Business

Company site ↗

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

What does this company do?

Ajax Engineering Limited manufactures and sells self-loading concrete mixers, concrete batching plants, and concrete pumps in India and internationally.

IndustryFarm & Heavy Construction Machinery

SectorIndustrials

Employees458

Annual revenue₹2,100 Cr

How does it make money?

Turns over ₹2,100 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 458 employees supports ₹4.59 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹4.59 Cr

Who are its competitors?

The closest listed comparisons in its industry are MAHINDRA & MAHINDRA LTD, ASHOK LEYLAND LTD, TATA MOTORS LIMITED, LARSEN & TOUBRO LTD.. 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 21.4%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 16.2% against a peer median of 24.4% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE24.4%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 15.6% and earnings to grow about 27.4% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+15.6%

Est. earnings growth+27.4%

Analysts3

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 +83% while net margin moved -9% 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+83%

Margin effect-9%

DalalBaazaar Score

69/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Small Cap: thinner liquidity and sharper drawdowns are normal

Quality vs. Valuation

Company Quality

76/ 100

Good

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

Valuation

53/ 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

28.4x

2Y Median

28.7x

22 monthly readings · mean 27.9x · range 17.9x–35.5x

Sector Median

27.6x

median of 4 sector peers

🟡Currently trading close to its 2y median of 28.7x — the market is paying about what it usually pays for this company.

🟡Against its sector it is priced broadly in line with the peer median of 27.6x.

vs. its own history

Fair

28.7x median over 22 months · -1%

vs. sector peers

Fair

27.6x median of 4 peers · +3%

vs. generic bands

Fair

15x–35x

EV/EBITDA

22.7x

PEG

1.55

What's Good / What's Bad

🟢 What's Going Well5

Debt is being paid down
Total debt is down 84% over 3 years.
Cash generation is improving
Free cash flow is up 109% over 3 years.
High return on capital employed
ROCE of 21.4% is the mark of a business that converts capital into profit efficiently.
Very low debt
Debt/Equity of 0.13x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 25.4% to 21.4% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Receivables growing faster than salesFinancial
Receivables up 138% against revenue up 83% — sales are being booked faster than they are collected.
🟡Margins are compressingFinancial
EBITDA margin is down 2.2 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 21.4% 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 84% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹350 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

Margins are being competed away
EBITDA margin has fallen from 15.4% to 13.2%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 138% against revenue up 83%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Size brings its own risk
Small 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 17% a year✓ 22.2% CAGR
Latest reported year was 1.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 13.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹350 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 18%✓ 21.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

12 / 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

5 good · 6 neutral · 0 weak

Market Cap

₹6,425 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

28.4x

Fair

Fairly valued against the generic band

P/B Ratio

4.62x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹19.79

Profitable

Profitable on a per-share basis

ROE

16.2%

Strong

Strong capital efficiency

ROCE

21.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.13x

Low

Conservative leverage

Revenue Growth (YoY)

1.7%

Modest

Modest growth

Profit Growth (YoY)

5.2%

Modest

Slow profit growth

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹350 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

19.1x

Improving

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

Operating Margin

11.9%

Average

Average margins

Net Margin

10.8%

Good

Strong bottom-line conversion

Current Ratio

4.19

Comfortable

Healthy short-term liquidity

52W Range Position

59%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

576.6 / 575.2

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

18.7

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,150 Cr	₹1,740 Cr	₹2,072 Cr	₹2,100 Cr	+22.2%
EBITDA	₹177 Cr	₹284 Cr	₹329 Cr	₹276 Cr	+16.0%
EBITDA Margin	15.4%	16.3%	15.9%	13.2%	—
PAT (Net Profit)	₹136 Cr	₹225 Cr	₹260 Cr	₹225 Cr	+18.3%
EPS	₹11.88	₹19.58	₹22.61	₹19.55	+18.1%
ROE	19.0%	24.5%	22.5%	16.2%	—
ROCE	25.4%	32.7%	30.1%	21.4%	—
Total Debt	₹12 Cr	₹8 Cr	₹2 Cr	₹2 Cr	-45.9%
Free Cash Flow	₹168 Cr	₹184 Cr	₹19 Cr	₹350 Cr	+27.8%

🟢 Revenue has grown at 22.2% a year over 3 years.

🟢 EBITDA has grown at 16.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 15.4% to 13.2% over 3 years (-2.2 pts).

🟢 PAT (Net Profit) has grown at 18.3% a year over 3 years.

🟢 EPS has grown at 18.1% a year over 3 years.

🔴 ROE has fallen from 19.0% to 16.2% over 3 years (-2.9 pts).

🔴 ROCE has fallen from 25.4% to 21.4% over 3 years (-4.0 pts).

🟢 Total Debt has shrunk at 45.9% a year over 3 years.

🟢 Free Cash Flow has grown at 27.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,752 Cr

Total Liabilities

₹359 Cr

Cash & Equivalents

₹166 Cr

Operating Cash Flow

₹377 Cr

Capex

-₹28 Cr

Shareholding (proxy)

Institutional Holding

10.1%

Insider Holding

80.0%

Analyst Consensus

Recommendations

4 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹707.5

+26.0% vs CMP

Target Range

₹660 – ₹770

Peer Comparison

Company	P/E	ROE
MAHINDRA & MAHINDRA LTD	17.8x	19.7%
ASHOK LEYLAND LTD	25.2x	24.4%
TATA MOTORS LIMITED	37.1x	32.8%
LARSEN & TOUBRO LTD.	30.1x	15.2%

Recent News

1 mixed5 general

AJAX ENGINEERING LIMITED Share Price - Live NSE: AJAXENGG Stock Price & Chart

Upstox, 05 May

Ajax Engineering schedules 34th AGM on September 28, 2026

scanx.trade, 28 Sept

Why Is Ajax Engineering Share Price Falling: Key Reasons and Investor Analysis 2026

Univest, 14 MayPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Ajax Engineering (NSEI:AJAXENGG) Stock Price

Simply Wall Street, 14 May

Ajax Engineering Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 31 Aug

Stocks to buy: Sagar Doshi suggests AJAX Engineering, Elgi Equipments, KFin Technologies shares to buy

Livemint, 21 Apr

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongFinancial Health · Growth · Profitability

MiddlingBusiness Quality · Valuation

WeakRisk

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 ↑