LAPL Automotive Limited

Consumer Cyclical — Auto Parts · BSE

₹116.50−₹5.05 (−4.15%)

DalalBaazaar Score

69 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by moderate debt load, negative free cash flow, micro-cap size, which brings thin liquidity.

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

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

What does this company do?

LAPL Automotive Limited designs, manufactures, and supplies a range of automotive components and accessories under the LAPL brand.

IndustryAuto Parts

SectorConsumer Cyclical

Employees73

Annual revenue₹93 Cr

How does it make money?

Turns over ₹93 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹17 left at the operating level before interest, tax and depreciation. Each of its 73 employees supports ₹1.27 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.27 Cr

Who are its competitors?

The closest listed comparisons in its industry are BOSCH LIMITED, MARUTI SUZUKI INDIA LTD., TVS MOTOR COMPANY LTD, EICHER MOTORS LTD. 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 45.9%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 41.2% against a peer median of 23.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE23.0%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +55% while net margin moved +181% 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+55%

Margin effect+181%

DalalBaazaar Score

69/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

76/ 100

Good

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

Valuation

74/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

16.9x

Sector Median

45.7x

median of 4 sector peers

🟢Against its sector it trades 63% below the peer median of 45.7x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

45.7x median of 4 peers · -63%

vs. generic bands

Fair

15x–35x

EV/EBITDA

10.6x

PEG

0.27

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 5.1% to 17.0% over 3 years.
Return on equity is rising
ROE has improved from 21.0% to 34.2%.
Return on capital is rising
ROCE has improved from 24.9% to 45.9%.
High return on capital employed
ROCE of 45.9% 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 Attention0

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

Red Flags

5 items require attention · 4 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 169% over 3 years, from ₹8 Cr to ₹21 Cr.
🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴Receivables growing faster than salesFinancial
Receivables up 346% against revenue up 55% — sales are being booked faster than they are collected.
🟡Inventory building faster than salesFinancial
Inventory up 109% against revenue up 55% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 45.9% 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 5.1% to 17.0%. 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 63% 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?

Sales are being booked faster than collected
Receivables are up 346% against revenue up 55%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
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.
Several serious flags at once
4 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 12% a year✓ 15.7% CAGR
Latest reported year was 41.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 15%✓ 17.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹4 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 43%✓ 45.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 10 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

Price history

Quick Metrics

5 good · 5 neutral · 1 weak

Market Cap

₹146 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

16.9x

Fair

Fairly valued against the generic band

P/B Ratio

4.06x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹6.88

Profitable

Profitable on a per-share basis

ROE

41.2%

Strong

Strong capital efficiency

ROCE

45.9%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.86x

Moderate

Moderate leverage

Revenue Growth (YoY)

41.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

71.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹7 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

15.6%

Good

Assets are working hard

Operating Margin

14.7%

Average

Average margins

Net Margin

9.3%

Average

Average bottom-line conversion

Current Ratio

1.12

Adequate

Adequate, but no real cushion

52W Range Position

46%

Mid-range

Technical Snapshot

RSI (14)

60.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹60 Cr	₹61 Cr	₹66 Cr	₹93 Cr	+15.7%
EBITDA	₹3 Cr	₹5 Cr	₹10 Cr	₹16 Cr	+72.4%
EBITDA Margin	5.1%	8.9%	15.1%	17.0%	—
PAT (Net Profit)	₹2 Cr	₹2 Cr	₹5 Cr	₹9 Cr	+63.3%
EPS	₹1.58	₹1.73	₹4.02	—	—
ROE	21.0%	18.8%	30.3%	34.2%	—
ROCE	24.9%	23.1%	37.5%	45.9%	—
Total Debt	₹8 Cr	₹13 Cr	₹16 Cr	₹21 Cr	+39.1%
Free Cash Flow	-₹3 Cr	-₹5 Cr	-₹4 Cr	-₹4 Cr	—

🟢 Revenue has grown at 15.7% a year over 3 years.

🟢 EBITDA has grown at 72.4% a year over 3 years.

🟢 EBITDA Margin has risen from 5.1% to 17.0% over 3 years (+11.9 pts).

🟢 PAT (Net Profit) has grown at 63.3% a year over 3 years.

🟢 ROE has risen from 21.0% to 34.2% over 3 years (+13.1 pts).

🟢 ROCE has risen from 24.9% to 45.9% over 3 years (+20.9 pts).

🔴 Total Debt has grown at 39.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹63 Cr

Total Liabilities

₹37 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹2 Cr

Capex

-₹6 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

72.0%

Peer Comparison

Company	P/E	ROE
BOSCH LIMITED	56.9x	15.9%
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TVS MOTOR COMPANY LTD	56.8x	35.8%
EICHER MOTORS LTD	34.7x	23.0%

Recent News

6 general

LAPL Automotive lists on BSE SME, begins fourth plant construction

scanx.trade, 16 Oct

LAPL AUTOMOTIVE LIMITED Share Price

Upstox, 09 Oct

LAPL Automotive SME IPO listing: Shares debut at a 44% premium despite weak stock market sentiment

Livemint, 13 Aug

BSE SME LAPL Automotive hits the road with strong listing gains

Business Standard, 13 Aug

LAPL Automotive Ltd. IPO Review - LAPL Automotive Ltd. IPO Dates, Issue Price, Subscription and Allotment Status

The Economic Times, 31 Jul

Compare ANG INDUSTRIES with

Equitymaster, 29 Sept

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Growth · Profitability

MiddlingFinancial Health · Valuation

WeakRisk

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 4 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑