Permanent Magnets Limited

Industrials — Electrical Equipment & Parts · NSE

₹905.00+₹26.05 (+2.96%)

DalalBaazaar Score

49 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: Reasonable but unspectacular business quality, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:01 pm

Understanding the Business

Company site ↗

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

What does this company do?

Permanent Magnets Limited engages in the manufacture and sale of cast alloy permanent magnets, parts, and accessories of electricity and electric vehicle worldwide.

IndustryElectrical Equipment & Parts

SectorIndustrials

Employees166

Annual revenue₹217 Cr

How does it make money?

Turns over ₹217 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹19 left at the operating level before interest, tax and depreciation. Each of its 166 employees supports ₹1.31 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.31 Cr

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, 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?Little sign of one

Returns on capital of 10.8% 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.

Peer median ROE17.1%

DalalBaazaar Score

49/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 61.2x is demanding — it needs sustained high growth to justify

Quality vs. Valuation

Company Quality

51/ 100

Average

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

Valuation

56/ 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

61.2x

Sector Median

88.8x

median of 3 sector peers

🟢Against its sector it trades 31% below the peer median of 88.8x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

88.8x median of 3 peers · -31%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

19.9x

PEG

—

Red Flags

2 items require attention · 1 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 1058% over 3 years, from ₹8 Cr to ₹88 Cr.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹26 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 31% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

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 17%✓ 19.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Free cash flow remains positive✗ -₹26 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✓ 10.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Interest cover stays above 4x✓ 7.6x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

4 / 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

3 good · 5 neutral · 3 weak

Market Cap

₹778 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

61.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

4.94x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹14.79

Profitable

Profitable on a per-share basis

ROE

9.4%

Moderate

Moderate capital efficiency

ROCE

10.8%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.56x

Low

Conservative leverage

Revenue Growth (YoY)

18.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-38.4%

Falling

Profits are shrinking

Dividend Yield

0.24%

Modest

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

Free Cash Flow

-₹26 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

11.8%

Average

Average margins

Net Margin

5.3%

Average

Average bottom-line conversion

Current Ratio

4.06

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.85

Market-like

Moves roughly in line with the market

52W Range Position

83%

Mid-range

Technical Snapshot

RSI (14)

59.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	—	₹194 Cr	₹197 Cr	₹217 Cr	—
EBITDA	₹5 Cr	₹38 Cr	₹34 Cr	₹42 Cr	+97.3%
EBITDA Margin	—	19.7%	17.5%	19.4%	—
PAT (Net Profit)	—	₹20 Cr	₹16 Cr	₹15 Cr	—
EPS	—	₹23.48	₹18.3	₹17.52	—
ROE	—	15.6%	10.9%	9.4%	—
ROCE	—	19.9%	14.2%	10.8%	—
Total Debt	₹8 Cr	₹24 Cr	₹24 Cr	₹88 Cr	+126.2%
Free Cash Flow	₹2 Cr	₹1 Cr	₹10 Cr	-₹26 Cr	—

🟢 EBITDA has grown at 97.3% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 19.4% over 3 years.

🔴 ROE has fallen from 15.6% to 9.4% over 3 years (-6.2 pts).

🔴 ROCE has fallen from 19.9% to 10.8% over 3 years (-9.1 pts).

🔴 Total Debt has grown at 126.2% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹26 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹282 Cr

Total Liabilities

₹125 Cr

Cash & Equivalents

₹28 Cr

Operating Cash Flow

₹18 Cr

Capex

-₹43 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

61.4%

Corporate Actions

Dividend Rate

₹2.2

Ex-Dividend Date

28 Jul 2026

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

1 positive3 mixed2 general

Permanent Magnets Share Price Down 0.02% After Q1 FY27 Results

Univest, 04 AugPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

High Performance Permanent Magnet Market

Future Market Insights, 24 Mar

Permanent Magnets revenue rises 19% as Alloys division gains traction in Q1FY27

scanx.trade, 04 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

₹7,280 crore rare earth magnet scheme: Vedanta, HZL shares rally up to 3.8%; what you need to know

Upstox, 07 AprPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Permanent Magnets Q1 FY27 Results Preview

Univest, 08 JulResults

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

3 Rare Earth Magnet Stocks to Watch as Government Allocates Rs 7,280 Crore for Magnet Manufacturing

Equitymaster, 27 Nov

Watch Items

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

DalalBaazaar Thesis

MiddlingBusiness Quality · Financial Health · Growth · Risk

WeakProfitability · Valuation

Points for each in the Score ↑

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.

2 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive · see Key things to watch ↑