Menon Pistons Limited

Consumer Cyclical — Auto Parts · NSE

₹65.80−₹0.61 (−0.92%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with modest growth. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Menon Pistons Limited manufactures and sells auto components in India.

IndustryAuto Parts

SectorConsumer Cyclical

Employees271

Annual revenue₹294 Cr

How does it make money?

Turns over ₹294 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 271 employees supports ₹1.08 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin16.9%

Net margin8.7%

Revenue / employee₹1.08 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.

BOSCH LIMITEDP/E 56.9x · ROE 15.9%

MARUTI SUZUKI INDIA LTD.P/E 25.2x · ROE 13.4%

TVS MOTOR COMPANY LTDP/E 56.8x · ROE 35.8%

EICHER MOTORS LTDP/E 34.7x · ROE 23.0%

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 20.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 14.4% 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.

ROCE20.3%

ROE14.4%

Peer median ROE23.0%

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 +21% while net margin moved -9% 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+21%

Margin effect-9%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 6.4% — barely ahead of inflation
✗ Profit CAGR of only 3.1%

Quality vs. Valuation

Company Quality

56/ 100

Average

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

Valuation

71/ 100

Cheap

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

12.9x

Sector Median

45.7x

median of 4 sector peers

🟢Against its sector it trades 72% 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 · -72%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

12.9x

P/B

1.89x

EV/EBITDA

6.8x

PEG

4.16

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 59% over 3 years.
High return on capital employed
ROCE of 20.3% 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 Attention2

Return on equity is falling
ROE has dropped from 19.8% to 14.4% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 30.2% to 20.3% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 2.77x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 20.3% 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.
Deleveraging frees up earnings
Debt is down 59% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 72% 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?

Leverage amplifies any setback
Debt/Equity of 2.77x. Interest is payable whether or not the business has a good year.
Growth barely outpaces inflation
Revenue compounding at 6.4% 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 19.8% to 14.4%. 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 15%✓ 16.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 5% a year✓ 6.4% CAGR
Latest reported year was 3.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹19 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 17%✓ 20.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

4 good · 6 neutral · 1 weak

Market Cap

₹336 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

12.9x

Cheap

Cheap against the generic band

P/B Ratio

1.89x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹5.1

Profitable

Profitable on a per-share basis

ROE

14.4%

Moderate

Moderate capital efficiency

ROCE

20.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

2.77x

High

High leverage

Revenue Growth (YoY)

3.7%

Modest

Modest growth

Profit Growth (YoY)

5.9%

Modest

Slow profit growth

Dividend Yield

None

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

Free Cash Flow

₹19 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹65.8

Operating Margin

13.3%

Average

Average margins

Net Margin

8.5%

Average

Average bottom-line conversion

Current Ratio

2.15

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.02

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

RSI (14)

31.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹244 Cr	₹251 Cr	₹246 Cr	₹294 Cr	+6.4%
EBITDA	₹45 Cr	₹48 Cr	₹46 Cr	₹50 Cr	+3.5%
EBITDA Margin	18.4%	19.0%	18.7%	16.9%	—
PAT (Net Profit)	₹23 Cr	₹26 Cr	₹24 Cr	₹26 Cr	+3.1%
ROE	19.8%	19.0%	15.2%	14.4%	—
ROCE	30.2%	26.0%	20.5%	20.3%	—
Total Debt	₹12 Cr	₹21 Cr	₹17 Cr	₹5 Cr	-25.5%
Free Cash Flow	₹30 Cr	-₹6 Cr	₹20 Cr	₹19 Cr	-14.3%

🟢 Revenue has grown at 6.4% a year over 3 years.

🟢 EBITDA has grown at 3.5% a year over 3 years.

🔴 EBITDA Margin has fallen from 18.4% to 16.9% over 3 years (-1.5 pts).

🟢 PAT (Net Profit) has grown at 3.1% a year over 3 years.

🔴 ROE has fallen from 19.8% to 14.4% over 3 years (-5.4 pts).

🔴 ROCE has fallen from 30.2% to 20.3% over 3 years (-9.9 pts).

🟢 Total Debt has shrunk at 25.5% a year over 3 years.

🔴 Free Cash Flow has shrunk at 14.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹232 Cr

Total Liabilities

₹54 Cr

Total Debt

₹5 Cr

Cash & Equivalents

₹2 Cr

Operating Cash Flow

₹51 Cr

Capex

-₹32 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

76.2%

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

2 positive1 mixed3 general

Tolins Tyres vs Azad India Mobility vs Menon Pistons: Which Stock Should You Track

Univest, 13 Oct

Menon Pistons FY26 net profit rises, recommends Re.1 dividend

scanx.trade, 22 MayCapital return

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

MENNPIS Stock Price and Chart — NSE:MENNPIS

TradingView, 20 Apr

Menon Pistons Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 31 Aug

Menon Pistons fixes record date for FY26 dividend

scanx.trade, 11 JulCapital return

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

Q1 results 2026: Power Grid to PB Fintech among companies to declare Q1 results today; full list here

Livemint, 05 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟡Business QualityAdequate12.6/20

🟢Financial HealthStrong14.5/20

🔴GrowthWeak7.4/20

🟡ProfitabilityModerate7.1/15

🟢ValuationAttractive11/15

🟡RiskModerate5.3/10

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. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 15%16.9%
✓Revenue growth stays above 5% a year6.4% CAGR
✓Free cash flow remains positive₹19 Cr
✓Debt / EBITDA stays below 2x0.1x
✓ROCE stays above 17%20.3%