Kirloskar Industries Limited

Industrials — Metal Fabrication · NSE

₹3,460.00+₹59.60 (+1.75%)

DalalBaazaar Score

52 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Low

Driven by micro-cap size, which brings thin liquidity, falling profits.

In simple words: The business is earning a fairly low return on the money invested in it, 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 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 Industries Limited engages in the manufacturing and sale of iron castings in India. It operates through Investments (Securities & Properties); Real Estate; Iron Casting; Tube; and Steel segments.

IndustryMetal Fabrication

SectorIndustrials

Employees22

Annual revenue₹6,686 Cr

How does it make money?

Turns over ₹6,686 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹14 left at the operating level before interest, tax and depreciation. Each of its 22 employees supports ₹303.93 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹303.93 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 6.6% 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 has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +4% while net margin moved +0% 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+4%

Margin effect+0%

DalalBaazaar Score

52/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 3.6% is weak
✗ ROE has fallen by 3.0 points over the period

Quality vs. Valuation

Company Quality

48/ 100

Average

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

Valuation

52/ 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

24.5x

3Y Median

22.0x

40 monthly readings · mean 21.3x · range 14.3x–29.3x

Sector Median

12.2x

median of 4 sector peers

⚠️Current valuation is approximately 11% above its 3y median of 22.0x. 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 101% above the peer median of 12.2x.

vs. its own history

Fair

22.0x median over 40 months · +11%

vs. sector peers

Expensive

12.2x median of 4 peers · +101%

vs. generic bands

Fair

15x–35x

EV/EBITDA

5.0x

PEG

16.23

What's Good / What's Bad

🟢 What's Going Well3

Cash generation is improving
Free cash flow is up 50% over 3 years.
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 Attention2

Return on equity is falling
ROE has dropped from 6.7% to 3.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 12.7% to 6.6% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 watch

🟡Receivables growing faster than salesFinancial
Receivables up 33% against revenue up 4% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹419 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?

Sales are being booked faster than collected
Receivables are up 33% against revenue up 4%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 101% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 1.4% 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 6.7% to 3.6%. 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
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 12%✓ 13.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✗ 1.4% 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✓ ₹419 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ 6.6%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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 · 4 neutral · 3 weak

Market Cap

₹3,638 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

24.5x

Fair

Fairly valued against the generic band

P/B Ratio

0.58x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹141.4

Profitable

Profitable on a per-share basis

ROE

3.6%

Weak

Weak capital efficiency

ROCE

6.6%

Weak

Low return on total capital employed

Debt/Equity

0.13x

Low

Conservative leverage

Revenue Growth (YoY)

4.3%

Modest

Modest growth

Profit Growth (YoY)

-23.0%

Falling

Profits are shrinking

Dividend Yield

0.38%

Modest

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

Free Cash Flow

₹419 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

9.2%

Average

Average margins

Net Margin

2.2%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.35

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.44

Defensive

Steadier than the market

52W Range Position

47%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

3547.5 / 3660.7

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

38.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹6,405 Cr	₹6,238 Cr	₹6,501 Cr	₹6,686 Cr	+1.4%
EBITDA	₹913 Cr	₹972 Cr	₹830 Cr	₹924 Cr	+0.4%
EBITDA Margin	14.3%	15.6%	12.8%	13.8%	—
PAT (Net Profit)	₹218 Cr	₹200 Cr	₹149 Cr	₹228 Cr	+1.5%
EPS	₹216.77	₹194.57	₹143.76	₹216.17	-0.1%
ROE	6.7%	4.0%	2.4%	3.6%	—
ROCE	12.7%	8.3%	6.1%	6.6%	—
Total Debt	₹972 Cr	₹1,226 Cr	₹1,280 Cr	₹1,109 Cr	+4.5%
Free Cash Flow	₹279 Cr	₹76 Cr	₹89 Cr	₹419 Cr	+14.5%

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

🟡 EBITDA has been broadly flat over 3 years (0.4% a year).

🟡 EBITDA Margin has held roughly flat at 13.8% over 3 years.

🟡 PAT (Net Profit) has been broadly flat over 3 years (1.5% a year).

🟡 EPS has been broadly flat over 3 years (-0.1% a year).

🔴 ROE has fallen from 6.7% to 3.6% over 3 years (-3.0 pts).

🔴 ROCE has fallen from 12.7% to 6.6% over 3 years (-6.1 pts).

🔴 Total Debt has grown at 4.5% a year over 3 years.

🟢 Free Cash Flow has grown at 14.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹11,690 Cr

Total Liabilities

₹3,344 Cr

Cash & Equivalents

₹97 Cr

Operating Cash Flow

₹870 Cr

Capex

-₹451 Cr

Shareholding (proxy)

Institutional Holding

1.2%

Insider Holding

75.8%

Corporate Actions

Dividend Rate

₹13

Ex-Dividend Date

11 Aug 2026

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

1 positive2 mixed2 negative1 general

Kirloskar Industries Files 32nd AGM Notice and FY26 Annual Report with ₹13 Dividend

scanx.trade, 14 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Kirloskar Industries Downgraded to Sell Amid Mixed Fundamentals and Technical Weakness

MarketsMojo, 16 OctAnalyst view

🔴Potentially negativeAn analyst opinion changing, which moves the price without changing the business.

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 Industries Share Price rises 13.14%: analysis

Univest, 11 SeptPrice 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 Industries share price rockets 13% on heavy volumes. Do you own?

Livemint, 11 Sept

Kirloskar Industries consolidated net profit declines 65.40% in the June 2026 quarter

Business Standard, 06 AugResults

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

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingRisk

WeakBusiness Quality · Growth · Profitability

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.

2 of 5 tripwires tripped — Revenue growth stays above 4% a year; ROCE stays above 8% · see Key things to watch ↑