Patels Airtemp (India) Limited

Industrials — Specialty Industrial Machinery · BSE

₹363.00+₹1.55 (+0.43%)

DalalBaazaar Score

44 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

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, but sales are shrinking. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 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 Patels Airtemp (India) Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Patels Airtemp (India) Limited manufactures and sells heat exchangers, pressure vessels, and air-conditioning and refrigeration equipment in India, Canada, the United States, Zambia, the United Kingdom, the Netherlands, Israel, Singapore, and Thailand.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees223

Annual revenue₹252 Cr

How does it make money?

Turns over ₹252 Cr a year. Of every ₹100 of sales, about ₹4 reaches shareholders as profit, with ₹10 left at the operating level before interest, tax and depreciation. Each of its 223 employees supports ₹1.13 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin9.9%

Net margin4.1%

Revenue / employee₹1.13 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.

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 12.8% 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.

ROCE12.8%

ROE6.2%

Peer median ROE17.1%

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 -10% while net margin moved +2% 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-10%

Margin effect+2%

DalalBaazaar Score

44/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 3.4% a year
✗ Profit has declined at 2.7% a year
✗ Latest-year revenue growth of -81.2% is below the longer-term trend — momentum is fading
✗ Profit fell 37.8% in the latest year

Quality vs. Valuation

Company Quality

44/ 100

Weak

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

Valuation

59/ 100

Fair

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

29.0x

3Y Median

18.4x

40 monthly readings · mean 17.8x · range 6.1x–33.0x

Sector Median

66.2x

median of 4 sector peers

⚠️Current valuation is approximately 58% above its 3y median of 18.4x. 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 56% below the peer median of 66.2x.

vs. its own history

Expensive

18.4x median over 40 months · +58%

vs. sector peers

Cheap

66.2x median of 4 peers · -56%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

29.0x

P/B

1.20x

EV/EBITDA

10.1x

PEG

—

Dividend Yield

0.83%

What's Good / What's Bad

🟢 What's Going Well2

Cash generation is improving
Free cash flow is up 1565% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on capital is falling
ROCE has declined from 15.7% to 12.8% — often a sign of competition or overexpansion.
Valuation above its historical average
At 29.0x the stock trades 58% above its own median of 18.4x.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 56% 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?

The debt load needs earnings to hold up
Debt is 3.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 58% 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
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 8%✓ 9.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 3.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 2.8x
How much operating profit can fall before interest stops being comfortably covered.
4Free cash flow remains positive✓ ₹16 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 10%✓ 12.8%
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

₹199 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

29.0x

Fair

Fairly valued against the generic band

P/B Ratio

1.20x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹12.51

Profitable

Profitable on a per-share basis

ROE

6.2%

Weak

Weak capital efficiency

ROCE

12.8%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.53x

Low

Conservative leverage

Revenue Growth (YoY)

-81.2%

Shrinking

Sales are contracting

Profit Growth (YoY)

-37.8%

Falling

Profits are shrinking

Dividend Yield

0.83%

Modest

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

Free Cash Flow

₹16 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹363

P/E (Forward)

17.0x

Improving

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

Operating Margin

6.1%

Average

Average margins

Net Margin

3.7%

Average

Average bottom-line conversion

Current Ratio

1.88

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.92

Market-like

Moves roughly in line with the market

52W Range Position

71%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

380.5 / 327.2

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

29.4

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹279 Cr	₹371 Cr	₹385 Cr	₹252 Cr	-3.4%
EBITDA	₹30 Cr	₹34 Cr	₹34 Cr	₹25 Cr	-5.4%
EBITDA Margin	10.6%	9.1%	8.9%	9.9%	—
PAT (Net Profit)	₹11 Cr	₹15 Cr	₹17 Cr	₹10 Cr	-2.7%
EPS	₹21.4	₹26.86	₹30.18	₹18.78	-4.3%
ROE	8.6%	10.3%	10.5%	6.2%	—
ROCE	15.7%	18.6%	18.5%	12.8%	—
Total Debt	₹95 Cr	₹93 Cr	₹90 Cr	₹88 Cr	-2.6%
Free Cash Flow	₹1 Cr	₹9 Cr	₹37 Cr	₹16 Cr	+155.4%

🔴 Revenue has shrunk at 3.4% a year over 3 years.

🔴 EBITDA has shrunk at 5.4% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 9.9% over 3 years.

🔴 PAT (Net Profit) has shrunk at 2.7% a year over 3 years.

🔴 EPS has shrunk at 4.3% a year over 3 years.

🔴 ROE has fallen from 8.6% to 6.2% over 3 years (-2.4 pts).

🔴 ROCE has fallen from 15.7% to 12.8% over 3 years (-2.9 pts).

🟢 Total Debt has shrunk at 2.6% a year over 3 years.

🟢 Free Cash Flow has grown at 155.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹297 Cr

Total Liabilities

₹131 Cr

Total Debt

₹88 Cr

Cash & Equivalents

₹34 Cr

Operating Cash Flow

₹23 Cr

Capex

-₹7 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

53.7%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

21 Aug 2026

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

Patels Airtemp (India) Ltd is Rated Sell

MarketsMojo, 18 Oct

Patels Airtemp Q1FY27 net loss hits ₹62 lakh as revenue plunges 81%

scanx.trade, 08 Aug

Patels Airtemp (India) Ltd. Share Price Live Today

CNBC TV18, 03 Jan

Patels Airtemp (India) reports standalone net loss of Rs 0.62 crore in the June 2026 quarter

Business Standard, 08 AugResults

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

Patels Airtemp (India) Ltd. Upper Circuit Today: Price, Data and Peers

Univest, 05 Oct

Patels Airtemp promoters acquire 69,442 shares via inter-se transfer

scanx.trade, 20 JunM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Watch Items

Revenue growth is negative (-81.2%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
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 QualityAdequate9/20

🟢Financial HealthStrong15.1/20

🔴GrowthWeak4.1/20

🔴ProfitabilityWeak4.5/15

🟡ValuationFair7.5/15

🔴RiskHigh4/10

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.

This thesis breaks if

✓EBITDA margin holds above 8%9.9%
✗Debt / EBITDA falls below 3x3.5x
✗Interest cover stays above 3x2.8x
✓Free cash flow remains positive₹16 Cr
✓ROCE stays above 10%12.8%