Kirloskar Ferrous Industries Limited

Industrials — Metal Fabrication · NSE

₹458.40+₹8.25 (+1.83%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Low

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

In simple words: Reasonable but unspectacular business quality, 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, 7:02 pm

Understanding the Business

Company site ↗

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

What does this company do?

Kirloskar Ferrous Industries Limited manufactures and sells iron castings, seamless tubes, and engineering steels in India and internationally. The company operates in three segments: Iron Casting, Tube, and Steel.

IndustryMetal Fabrication

SectorIndustrials

Employees3,334

Annual revenue₹6,649 Cr

How does it make money?

Turns over ₹6,649 Cr a year. Of every ₹100 of sales, about ₹8 reaches shareholders as profit, with ₹14 left at the operating level before interest, tax and depreciation. Each of its 3,334 employees supports ₹1.99 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.99 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, HINDALCO INDUSTRIES LTD, VEDANTA 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?Little sign of one

Returns on capital of 14.2% 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.

Peer median ROE18.7%

What is the outlook?

1 analysts covering the stock expect revenue to grow about 13.1% and earnings to grow about 28.1% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+13.1%

Est. earnings growth+28.1%

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 +14% while net margin moved +1% 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+14%

Margin effect+1%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 4.6% — barely ahead of inflation
✗ Profit CAGR of only 5.1%
✗ Profit fell 13.4% in the latest year

Quality vs. Valuation

Company Quality

55/ 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.

Historical Valuation

Current P/E

22.0x

1.1Y Median

17.0x

13 monthly readings · mean 19.1x · range 14.7x–26.8x

Sector Median

12.2x

median of 4 sector peers

⚠️Current valuation is approximately 29% above its 1.1y median of 17.0x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 81% above the peer median of 12.2x.

vs. its own history

Expensive

17.0x median over 13 months · +29%

vs. sector peers

Expensive

12.2x median of 4 peers · +81%

vs. generic bands

Fair

15x–35x

EV/EBITDA

9.4x

PEG

4.34

What's Good / What's Bad

🟢 What's Going Well3

Cash generation is improving
Free cash flow is up 56% over 3 years.
Very low debt
Debt/Equity of 0.27x 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 19.6% to 14.2% — often a sign of competition or overexpansion.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹494 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?

The price already assumes success
The stock trades 29% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Growth barely outpaces inflation
Revenue compounding at 4.6% 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.
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 12%✓ 13.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✓ 4.6% CAGR
Latest reported year was 4.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹494 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 11%✓ 14.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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

3 good · 7 neutral · 1 weak

Market Cap

₹7,571 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

22.0x

Fair

Fairly valued against the generic band

P/B Ratio

1.96x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹20.87

Profitable

Profitable on a per-share basis

ROE

13.1%

Moderate

Moderate capital efficiency

ROCE

14.2%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.27x

Low

Conservative leverage

Revenue Growth (YoY)

4.3%

Modest

Modest growth

Profit Growth (YoY)

-13.4%

Falling

Profits are shrinking

Dividend Yield

1.31%

Modest

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

Free Cash Flow

₹494 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

11.2x

Improving

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

Operating Margin

8.3%

Average

Average margins

Net Margin

5.1%

Average

Average bottom-line conversion

Current Ratio

1.11

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.45

Defensive

Steadier than the market

52W Range Position

48%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

468.6 / 457.4

Bullish alignment (short > long)

RSI (14)

33.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹5,808 Cr	₹6,026 Cr	₹6,469 Cr	₹6,649 Cr	+4.6%
EBITDA	₹872 Cr	₹874 Cr	₹811 Cr	₹910 Cr	+1.4%
EBITDA Margin	15.0%	14.5%	12.5%	13.7%	—
PAT (Net Profit)	₹437 Cr	₹298 Cr	₹294 Cr	₹507 Cr	+5.1%
EPS	₹26.59	₹18.02	₹17.77	₹30.68	+4.9%
ROE	14.5%	9.2%	8.6%	13.1%	—
ROCE	19.6%	14.3%	13.4%	14.2%	—
Total Debt	₹971 Cr	₹1,224 Cr	₹1,278 Cr	₹1,036 Cr	+2.2%
Free Cash Flow	₹316 Cr	₹30 Cr	₹171 Cr	₹494 Cr	+16.0%

🟢 Revenue has grown at 4.6% a year over 3 years.

🟡 EBITDA has been broadly flat over 3 years (1.4% a year).

🔴 EBITDA Margin has fallen from 15.0% to 13.7% over 3 years (-1.3 pts).

🟢 PAT (Net Profit) has grown at 5.1% a year over 3 years.

🟢 EPS has grown at 4.9% a year over 3 years.

🔴 ROE has fallen from 14.5% to 13.1% over 3 years (-1.4 pts).

🔴 ROCE has fallen from 19.6% to 14.2% over 3 years (-5.4 pts).

🔴 Total Debt has grown at 2.2% a year over 3 years.

🟢 Free Cash Flow has grown at 16.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹6,589 Cr

Total Liabilities

₹2,726 Cr

Cash & Equivalents

₹87 Cr

Operating Cash Flow

₹942 Cr

Capex

-₹448 Cr

Shareholding (proxy)

Institutional Holding

13.9%

Insider Holding

60.4%

Corporate Actions

Dividend Rate

₹6

Ex-Dividend Date

17 Jul 2026

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹563

+22.8% vs CMP

Target Range

₹560 – ₹566

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
HINDALCO INDUSTRIES LTD	12.3x	12.0%
VEDANTA LIMITED	10.4x	18.7%

Recent News

2 mixed1 negative3 general

Kirloskar Ferrous resumes Hiriyur plant operations from October 16

scanx.trade, 17 Oct

Kirloskar Ferrous Industries (BSE:500245) Stock Forecast & Analyst Predictions

Simply Wall Street, 07 OctAnalyst view

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

Kirloskar Ferrous Industries jumps 12% after bagging $13.5 million export order

Moneycontrol.com, 18 Jun

Kirloskar Ferrous Share Price Falls 4% As Q1 Net Profit Drops 65% YoY

NDTV Profit, 05 AugResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Kirloskar Ferrous share price jumps 14%, hits 52-week high. What's driving the rally?

Livemint, 18 JunPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Kirloskar Ferrous Industries Ltd Sees Technical Momentum Shift Amid Mixed Indicator Signals

MarketsMojo, 13 Oct

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health

MiddlingBusiness Quality · Profitability · Valuation · Risk

WeakGrowth

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.

All 5 tripwires holding · see Key things to watch ↑