International Combustion (India) Limited

Industrials — Specialty Industrial Machinery · BSE

₹407.05+₹1.05 (+0.26%)

DalalBaazaar Score

45 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by the company is currently loss-making, micro-cap size, which brings thin liquidity, falling profits.

In simple words: The company is currently losing money, though profits are falling even as sales grow. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

International Combustion (India) Limited manufactures and supplies heavy engineering equipment, geared motors and gear boxes, and dry mix products in India and internationally.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees585

Annual revenue₹291 Cr

How does it make money?

Turns over ₹291 Cr a year. Of every ₹100 of sales, about ₹-1 reaches shareholders as profit, with ₹2 left at the operating level before interest, tax and depreciation. Each of its 585 employees supports ₹49.7 lakh of revenue a year, the signature of a people-led business.

EBITDA margin2.0%

Net margin-0.8%

Revenue / employee₹49.7 lakh

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.

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

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

HAVELLS INDIA LIMITEDP/E 43.5x · ROE 17.1%

What is its competitive advantage?Little sign of one

Returns on capital of -0.8% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

ROCE-0.8%

ROE-1.8%

Peer median ROE17.1%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +32% while net margin moved -122% 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+32%

Margin effect-122%

DalalBaazaar Score

45/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✗ ROE has fallen by 10.0 points over the period

Quality vs. Valuation

Company Quality

45/ 100

Average

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

Valuation

36/ 100

Expensive

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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

P/E (Trailing)

Not meaningful

P/B

0.74x

EV/EBITDA

21.0x

PEG

—

Dividend Yield

0.98%

What's Good / What's Bad

🟢 What's Going Well2

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Very low debt
Debt/Equity of 0.21x leaves the balance sheet with plenty of headroom.

🔴 What Needs Attention4

Margins are compressing
EBITDA margin has slipped from 7.6% to 2.0% over 3 years.
Debt is rising
Total debt is up 105% over 3 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 8.2% to -1.8% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 11.9% to -0.8% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 4 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 105% over 3 years, from ₹13 Cr to ₹27 Cr.
🔴Thin interest coverageFinancial
Operating profit covers interest only -0.5x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹2 Cr in the latest reported year.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 5.6 points, from 7.6% to 2.0%.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 5.8x to -0.5x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹16 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 7.6% to 2.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.7x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 8.2% to -1.8%. 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.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
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

1EBITDA margin holds above 0%✓ 2.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.7x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ -0.5x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 7% a year✓ 9.8% CAGR
Latest reported year was 10.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹16 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 11 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
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 2 neutral · 5 weak

Market Cap

₹97 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

0.74x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹-22.81

Loss-making

Negative earnings per share — the business is losing money

ROE

-1.8%

Weak

Weak capital efficiency

ROCE

-0.8%

Weak

Low return on total capital employed

Debt/Equity

0.21x

Low

Conservative leverage

Revenue Growth (YoY)

10.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-116.0%

Falling

Profits are shrinking

Dividend Yield

0.98%

Modest

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

Free Cash Flow

₹16 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹407.05

Operating Margin

-6.4%

Weak

Thin margins leave little room for error

Net Margin

-1.8%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.72

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.42

Defensive

Steadier than the market

52W Range Position

13%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

443.4 / 476.7

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

22.5

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹219 Cr	₹293 Cr	₹290 Cr	₹291 Cr	+9.8%
EBITDA	₹17 Cr	₹39 Cr	₹23 Cr	₹6 Cr	-30.0%
EBITDA Margin	7.6%	13.4%	8.1%	2.0%	—
PAT (Net Profit)	₹8 Cr	₹20 Cr	₹15 Cr	-₹2 Cr	—
EPS	₹34.76	₹83.48	₹62.54	₹-10.01	—
ROE	8.2%	16.6%	11.2%	-1.8%	—
ROCE	11.9%	26.0%	14.1%	-0.8%	—
Total Debt	₹13 Cr	₹31 Cr	₹33 Cr	₹27 Cr	+27.0%
Free Cash Flow	-₹5 Cr	-₹15 Cr	₹7 Cr	₹16 Cr	—

🟢 Revenue has grown at 9.8% a year over 3 years.

🔴 EBITDA has shrunk at 30.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 7.6% to 2.0% over 3 years (-5.6 pts).

🔴 PAT (Net Profit) has turned negative, from ₹8 Cr to -₹2 Cr.

🔴 EPS has turned negative, from ₹34.76 to ₹-10.01.

🔴 ROE has fallen from 8.2% to -1.8% over 3 years (-10.0 pts).

🔴 ROCE has fallen from 11.9% to -0.8% over 3 years (-12.7 pts).

🔴 Total Debt has grown at 27.0% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹5 Cr to ₹16 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹234 Cr

Total Liabilities

₹103 Cr

Total Debt

₹27 Cr

Cash & Equivalents

₹4 Cr

Operating Cash Flow

₹23 Cr

Capex

-₹7 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

55.9%

Corporate Actions

Dividend Rate

₹4

Ex-Dividend Date

03 Sept 2025

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

6 general

International Combustion (India) Ltd. Peer Comparison – Compare with Others

Value Research, 31 Aug

International Combustion publishes AGM notice, seeks ₹200 crore borrowing power

scanx.trade, 24 Jul

International Combustion (India) Ltd. Share Price Live Today

CNBC TV18, 03 Jan

Price and market trends of battery electric and internal combustion engine vehicles in Germany, 2020–2025

International Council on Clean Transportation, 20 Jul

International Combustion Q1FY26 net loss widens to ₹399 lakh

scanx.trade, 30 Jul

Trends in electric cars - Global EV Outlook 2026

IEA - International Energy Agency, 20 May

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

🔴Business QualityWeak4.7/20

🟡Financial HealthAdequate12.7/20

🟢GrowthStrong13.6/20

🔴ProfitabilityWeak2.5/15

🟡ValuationFair7.1/15

🔴RiskHigh4.4/10

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. 4 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 0%2.0%
✗Debt / EBITDA falls below 3x4.7x
✗Interest cover stays above 3x-0.5x
✓Revenue growth stays above 7% a year9.8% CAGR
✓Free cash flow remains positive₹16 Cr