Grindwell Norton Limited

Industrials — Building Products & Equipment · NSE

₹1,893.00−₹4.70 (−0.25%)

DalalBaazaar Score

56 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by high debt relative to equity, small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:01 pm

Understanding the Business

Company site ↗

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

What does this company do?

Grindwell Norton Limited provides abrasives, life sciences, performance plastics, and ceramics solutions in India and internationally. The company operates through the Abrasives, Ceramics & Plastics, Digital Services, and Others segments.

IndustryBuilding Products & Equipment

SectorIndustrials

Employees2,385

Annual revenue₹3,060 Cr

How does it make money?

Turns over ₹3,060 Cr a year. Of every ₹100 of sales, about ₹14 reaches shareholders as profit, with ₹20 left at the operating level before interest, tax and depreciation. Each of its 2,385 employees supports ₹1.28 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.28 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB 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 21.0%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 16.4% against a peer median of 15.2% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE15.2%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 13.2% and earnings to grow about 13.2% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+13.2%

Est. earnings growth+13.2%

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 +21% while net margin moved -5% 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+21%

Margin effect-5%

DalalBaazaar Score

56/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 48.0x is demanding — it needs sustained high growth to justify
• P/E is close to its own historical median of 55.4x
✗ P/B of 8.27x is a steep premium to book

Quality vs. Valuation

Company Quality

60/ 100

Average

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

Valuation

46/ 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

48.0x

3Y Median

55.4x

40 monthly readings · mean 57.8x · range 40.6x–83.6x

Sector Median

88.8x

median of 3 sector peers

🟢Current valuation is approximately 13% below its 3y median of 55.4x. 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 46% below the peer median of 88.8x.

vs. its own history

Fair

55.4x median over 40 months · -13%

vs. sector peers

Cheap

88.8x median of 3 peers · -46%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

33.4x

PEG

10.17

What's Good / What's Bad

🟢 What's Going Well3

Cash generation is improving
Free cash flow is up 496% over 3 years.
High return on capital employed
ROCE of 21.0% 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 20.0% to 16.4% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 25.8% to 21.0% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 2.38x — earnings must service borrowings before shareholders see anything.
🟡Receivables growing faster than salesFinancial
Receivables up 42% against revenue up 21% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 21.0% 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.
Cheaper than its peers
It trades 46% 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 2.38x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 42% against revenue up 21%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Growth barely outpaces inflation
Revenue compounding at 6.6% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Returns on shareholder capital are falling
ROE has dropped from 20.0% to 16.4%. 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
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

1EBITDA margin holds above 18%✓ 20.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 5% a year✓ 6.6% CAGR
Latest reported year was 14.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹423 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 18%✓ 21.0%
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 · 2 neutral · 3 weak

Market Cap

₹20,959 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

48.0x

Expensive

Expensive — verify against sector peers

P/B Ratio

8.27x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹39.4

Profitable

Profitable on a per-share basis

ROE

16.4%

Strong

Strong capital efficiency

ROCE

21.0%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

2.38x

High

High leverage

Revenue Growth (YoY)

14.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

22.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.00%

Modest

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

Free Cash Flow

₹423 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

36.8x

Improving

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

Operating Margin

16.2%

Good

Healthy core-business profitability

Net Margin

13.8%

Good

Strong bottom-line conversion

Current Ratio

2.81

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.54

Defensive

Steadier than the market

52W Range Position

50%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1964.5 / 1995.5

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

37.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,525 Cr	₹2,669 Cr	₹2,799 Cr	₹3,060 Cr	+6.6%
EBITDA	₹538 Cr	₹561 Cr	₹561 Cr	₹627 Cr	+5.3%
EBITDA Margin	21.3%	21.0%	20.0%	20.5%	—
PAT (Net Profit)	₹362 Cr	₹384 Cr	₹369 Cr	₹416 Cr	+4.7%
EPS	₹32.69	₹34.65	₹33.3	₹37.54	+4.7%
ROE	20.0%	18.7%	16.3%	16.4%	—
ROCE	25.8%	23.5%	20.7%	21.0%	—
Total Debt	₹51 Cr	₹83 Cr	₹84 Cr	₹61 Cr	+5.7%
Free Cash Flow	₹71 Cr	₹196 Cr	₹364 Cr	₹423 Cr	+81.3%

🟢 Revenue has grown at 6.6% a year over 3 years.

🟢 EBITDA has grown at 5.3% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 20.5% over 3 years.

🟢 PAT (Net Profit) has grown at 4.7% a year over 3 years.

🟢 EPS has grown at 4.7% a year over 3 years.

🔴 ROE has fallen from 20.0% to 16.4% over 3 years (-3.6 pts).

🔴 ROCE has fallen from 25.8% to 21.0% over 3 years (-4.8 pts).

🔴 Total Debt has grown at 5.7% a year over 3 years.

🟢 Free Cash Flow has grown at 81.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,438 Cr

Total Liabilities

₹888 Cr

Cash & Equivalents

₹79 Cr

Operating Cash Flow

₹542 Cr

Capex

-₹119 Cr

Shareholding (proxy)

Institutional Holding

21.9%

Insider Holding

58.3%

Corporate Actions

Next Earnings

29 Oct 2026

Dividend Rate

₹19

Ex-Dividend Date

10 Jul 2026

Analyst Consensus

Recommendations

3 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹2,169.33

+14.6% vs CMP

Target Range

₹2,113 – ₹2,270

Peer Comparison

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

Recent News

2 mixed4 general

Grindwell Norton (NSEI:GRINDWELL) Stock Forecast & Analyst Predictions

Simply Wall Street, 09 OctAnalyst view

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

GRINDWELL 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.

Grindwell Norton Ltd leads losers in 'A' group

Business Standard, 17 Jul

45% YTD rally! Experts see up to 56% upside in these 3 stocks on China's export shift | Target, rationale

Livemint, 01 Oct

Grindwell Norton (NSE: GRINDWELL) Stock Falls After Rally

Kalkine India, 17 Jul

Grindwell Norton promoters confirm shares free from encumbrances

scanx.trade, 17 Jun

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health

MiddlingProfitability · Risk

WeakGrowth · Valuation

Points for each in the Score ↑

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. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑