LMW Limited

Industrials — Specialty Industrial Machinery · NSE

₹16,050.00+₹95.00 (+0.60%)

DalalBaazaar Score

41 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by small-cap size, which brings sharper price swings, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Valuation is currently 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 LMW Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

LMW Limited, together with its subsidiaries, manufactures and sells textile spinning machinery in India and internationally. The company operates through three segments: Textile Machinery Division, Machine Tool/Foundry Division, and Advanced Technology Centre.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees3,506

Annual revenue₹3,119 Cr

How does it make money?

Turns over ₹3,119 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹9 left at the operating level before interest, tax and depreciation. Each of its 3,506 employees supports ₹89.0 lakh of revenue a year, the signature of a people-led business.

EBITDA margin8.9%

Net margin4.2%

Revenue / employee₹89.0 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 5.9% 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.

ROCE5.9%

ROE4.6%

Peer median ROE17.1%

What is the outlook?

1 analysts covering the stock expect revenue to grow about 38.8% and earnings to grow about 66.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+38.8%

Est. earnings growth+66.8%

Analysts1

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -33% while net margin moved -49% 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-33%

Margin effect-49%

DalalBaazaar Score

41/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 12.4% a year
✗ Profit has declined at 30.2% a year

Quality vs. Valuation

Company Quality

42/ 100

Weak

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

Valuation

23/ 100

Expensive

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

Weak on business quality and not cheap enough to compensate.

Historical Valuation

Current P/E

98.1x

3Y Median

47.7x

40 monthly readings · mean 86.6x · range 36.7x–168.2x

Sector Median

66.2x

median of 4 sector peers

⚠️Current valuation is approximately 105% above its 3y median of 47.7x. 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 48% above the peer median of 66.2x.

vs. its own history

Expensive

47.7x median over 40 months · +105%

vs. sector peers

Expensive

66.2x median of 4 peers · +48%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

98.1x

P/B

5.98x

EV/EBITDA

60.4x

PEG

—

Dividend Yield

0.22%

What's Good / What's Bad

🟢 What's Going Well2

Cash generation is improving
Free cash flow is up 20% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention4

Return on equity is falling
ROE has dropped from 16.4% to 4.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 13.7% to 5.9% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 20% against revenue growth of -33% — customers are taking longer to pay.
Valuation above its historical average
At 98.1x the stock trades 105% above its own median of 47.7x.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Receivables growing faster than salesFinancial
Receivables up 20% against revenue up -33% — sales are being booked faster than they are collected.
🟡Profit is decliningFinancial
Net profit is down 66% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

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 20% against revenue up -33%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 105% 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.
Returns on shareholder capital are falling
ROE has dropped from 16.4% to 4.6%. 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
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 7%✓ 8.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹104 Cr
Profit that never becomes cash eventually stops being profit.
3ROCE stays above 8%✗ 5.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
4Valuation vs its own median of 47.7x✗ 98.1x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

5 / 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
✓ 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

4 good · 3 neutral · 4 weak

Market Cap

₹17,146 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

98.1x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.98x

Rich

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

EPS (TTM)

₹163.6

Profitable

Profitable on a per-share basis

ROE

4.6%

Weak

Weak capital efficiency

ROCE

5.9%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

24.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

383.9%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.22%

Modest

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

Free Cash Flow

₹104 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹16,050

P/E (Forward)

42.5x

Improving

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

Operating Margin

3.9%

Weak

Thin margins leave little room for error

Net Margin

5.2%

Average

Average bottom-line conversion

Current Ratio

2.30

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.61

Defensive

Steadier than the market

52W Range Position

50%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

16709.3 / 17812.2

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

29.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,639 Cr	₹4,618 Cr	₹2,909 Cr	₹3,119 Cr	-12.4%
EBITDA	₹422 Cr	₹434 Cr	₹260 Cr	₹278 Cr	-13.0%
EBITDA Margin	9.1%	9.4%	8.9%	8.9%	—
PAT (Net Profit)	₹384 Cr	₹374 Cr	₹103 Cr	₹131 Cr	-30.2%
EPS	₹359.47	₹349.77	₹96.05	₹122.37	-30.2%
ROE	16.4%	13.8%	3.7%	4.6%	—
ROCE	13.7%	11.4%	5.0%	5.9%	—
Free Cash Flow	₹86 Cr	-₹11 Cr	-₹101 Cr	₹104 Cr	+6.4%

🔴 Revenue has shrunk at 12.4% a year over 3 years.

🔴 EBITDA has shrunk at 13.0% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 8.9% over 3 years.

🔴 PAT (Net Profit) has shrunk at 30.2% a year over 3 years.

🔴 EPS has shrunk at 30.2% a year over 3 years.

🔴 ROE has fallen from 16.4% to 4.6% over 3 years (-11.9 pts).

🔴 ROCE has fallen from 13.7% to 5.9% over 3 years (-7.8 pts).

🟢 Free Cash Flow has grown at 6.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,262 Cr

Total Liabilities

₹1,396 Cr

Total Debt

—

Cash & Equivalents

₹395 Cr

Operating Cash Flow

₹177 Cr

Capex

-₹74 Cr

Shareholding (proxy)

Institutional Holding

13.5%

Insider Holding

57.2%

Corporate Actions

Next Earnings

21 Oct 2026

Dividend Rate

₹35

Ex-Dividend Date

17 Jul 2026

Analyst Consensus

Recommendations

0 Buy · 1 Hold · 1 Sell

Target Price (Mean)

₹11,458

-28.6% vs CMP

Target Range

₹7,718 – ₹15,198

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

2 mixed4 general

LMW Stock Price and Chart — NSE:LMW

TradingView, 10 Aug

LMW Ltd Share/Stock Price Live Today | The HinduBusinessLine

BusinessLine, 08 Oct

LMW (NSEI:LMW) Stock Forecast & Analyst Predictions

Simply Wall Street, 27 JulAnalyst view

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

LMW Ltd | Stock Share Price Live

MarketSmith India, 13 Mar

LMW Limited net profit surges 169% in Q1FY26 on margin expansion

scanx.trade, 27 JulCapacity

🟡Mixed / dependsCapacity additions can raise revenue over two to three years, but the capital spend usually pressures free cash flow first. Worth checking whether the capex is funded from operations or from borrowing.

LMW Ltd. Share Price Hits One-Year High: Stock Analysis

Univest, 14 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.
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 QualityWeak5.9/20

🟢Financial HealthStrong17.3/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak5.8/15

🔴ValuationDemanding3.3/15

🟡RiskModerate6/10

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 7%8.9%
✓Free cash flow remains positive₹104 Cr
✗ROCE stays above 8%5.9%
✗Valuation vs its own median of 47.7x98.1x today