Kirloskar Pneumatic Company Limited

Industrials — Specialty Industrial Machinery · NSE

₹636.95+₹2.10 (+0.33%)

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, 7:49 pm

Understanding the Business

Company site ↗

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

What does this company do?

Kirloskar Pneumatic Company Limited, together with its subsdiary, engages manufacture and sale of compression and transmission products in India. It operates through Compression Systems and Other non-reportable segments.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees926

Annual revenue₹1,777 Cr

How does it make money?

Turns over ₹1,777 Cr a year. Of every ₹100 of sales, about ₹14 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 926 employees supports ₹1.92 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.92 Cr

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.

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 26.4%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 20.5% against a peer median of 17.1% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE17.1%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 16.7% and earnings to grow about 16.6% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+16.7%

Est. earnings growth+16.6%

Analysts3

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +45% while net margin moved +63% 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+45%

Margin effect+63%

DalalBaazaar Score

69/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 31.6x already prices in growth
✗ P/E is 38% above its own historical median of 22.8x — expensive by its own standards
✗ P/B of 6.63x is a steep premium to book

Quality vs. Valuation

Company Quality

78/ 100

Good

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

Valuation

55/ 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

31.6x

3Y Median

22.8x

40 monthly readings · mean 24.9x · range 16.0x–43.0x

Sector Median

66.2x

median of 4 sector peers

⚠️Current valuation is approximately 38% above its 3y median of 22.8x. 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 52% below the peer median of 66.2x.

vs. its own history

Expensive

22.8x median over 40 months · +38%

vs. sector peers

Cheap

66.2x median of 4 peers · -52%

vs. generic bands

Fair

15x–35x

EV/EBITDA

22.3x

PEG

0.95

What's Good / What's Bad

🟢 What's Going Well7

Margins are improving
EBITDA margin is up from 13.7% to 20.6% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from 13.7% to 20.5%.
Return on capital is rising
ROCE has improved from 17.6% to 26.4%.
High return on capital employed
ROCE of 26.4% is the mark of a business that converts capital into profit efficiently.
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 Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 high

🔴Debt has risen sharplyFinancial
Total debt is up 228% over 3 years, from ₹1 Cr to ₹3 Cr.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 26.4% 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.
Margin expansion has further to run
EBITDA margin has risen from 13.7% to 20.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 52% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹166 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 38% 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.
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 10% a year✓ 13.1% CAGR
Latest reported year was 7.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 19%✓ 20.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹166 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 23%✓ 26.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

11 / 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 · 4 neutral · 1 weak

Market Cap

₹8,278 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

31.6x

Fair

Fairly valued against the generic band

P/B Ratio

6.63x

Rich

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

EPS (TTM)

₹20.18

Profitable

Profitable on a per-share basis

ROE

20.5%

Strong

Strong capital efficiency

ROCE

26.4%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.27x

Low

Conservative leverage

Revenue Growth (YoY)

7.6%

Modest

Modest growth

Profit Growth (YoY)

32.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.94%

Modest

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

Free Cash Flow

₹166 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

24.9x

Improving

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

Operating Margin

12.1%

Average

Average margins

Net Margin

14.5%

Good

Strong bottom-line conversion

Current Ratio

2.65

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.56

Defensive

Steadier than the market

52W Range Position

24%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

680.4 / 713.5

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

32.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,229 Cr	₹1,312 Cr	₹1,628 Cr	₹1,777 Cr	+13.1%
EBITDA	₹168 Cr	₹207 Cr	₹300 Cr	₹366 Cr	+29.5%
EBITDA Margin	13.7%	15.8%	18.4%	20.6%	—
PAT (Net Profit)	₹109 Cr	₹133 Cr	₹211 Cr	₹256 Cr	+33.1%
EPS	₹16.77	₹20.57	₹32.5	₹39.39	+32.9%
ROE	13.7%	14.4%	19.3%	20.5%	—
ROCE	17.6%	18.7%	24.7%	26.4%	—
Total Debt	₹1 Cr	₹1 Cr	₹11 Cr	₹3 Cr	+48.5%
Free Cash Flow	-₹3 Cr	₹112 Cr	₹137 Cr	₹166 Cr	—

🟢 Revenue has grown at 13.1% a year over 3 years.

🟢 EBITDA has grown at 29.5% a year over 3 years.

🟢 EBITDA Margin has risen from 13.7% to 20.6% over 3 years (+6.9 pts).

🟢 PAT (Net Profit) has grown at 33.1% a year over 3 years.

🟢 EPS has grown at 32.9% a year over 3 years.

🟢 ROE has risen from 13.7% to 20.5% over 3 years (+6.9 pts).

🟢 ROCE has risen from 17.6% to 26.4% over 3 years (+8.9 pts).

🔴 Total Debt has grown at 48.5% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹3 Cr to ₹166 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,757 Cr

Total Liabilities

₹498 Cr

Cash & Equivalents

₹114 Cr

Operating Cash Flow

₹233 Cr

Capex

-₹66 Cr

Shareholding (proxy)

Institutional Holding

30.4%

Insider Holding

44.6%

Corporate Actions

Dividend Rate

₹6

Ex-Dividend Date

03 Jul 2026

Analyst Consensus

Recommendations

3 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹899.5

+41.2% vs CMP

Target Range

₹856 – ₹965

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

1 positive5 general

Is Now The Time To Put Kirloskar Pneumatic (NSE:KIRLPNU) On Your Watchlist?

Simply Wall Street, 14 Oct

Kirloskar Pneumatic fixes Aug 18 as record date for stock split

scanx.trade, 05 AugCapital return

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

Kirloskar Pneumatic Company Ltd. (KIRLPNU) Share Price Hits Fresh 52-Week Low

Univest, 18 Aug

Kirloskar Pneumatic Company Ltd Sees Technical Momentum Shift Amid Mixed Signals

MarketsMojo, 14 Oct

Buy Kirloskar Pneumatic Company; target of Rs 861: Prabhudas Lilladher

Moneycontrol.com, 18 Sept

Kirloskar Pneumatic Targets ₹2100 Crore FY27 Revenue and ₹100 Crore Biogas Orders

Sahi, 23 Jul

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability

MiddlingRisk

WeakValuation

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 ↑