Quality Power Electrical Equipments Limited

Industrials — Electrical Equipment & Parts · NSE

₹1,456.00+₹22.20 (+1.55%)

DalalBaazaar Score

61 / 100

🟢 Good

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, negative free cash flow, small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt 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 Quality Power Electrical Equipments Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Quality Power Electrical Equipments Limited provides power products and solutions for power generation, transmission, distribution, and automation sectors in India and internationally.

IndustryElectrical Equipment & Parts

SectorIndustrials

Employees249

Annual revenue₹936 Cr

How does it make money?

Turns over ₹936 Cr a year. Of every ₹100 of sales, about ₹13 reaches shareholders as profit, with ₹25 left at the operating level before interest, tax and depreciation. Each of its 249 employees supports ₹3.76 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin25.1%

Net margin13.0%

Revenue / employee₹3.76 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.

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

HAVELLS INDIA LIMITEDP/E 43.5x · ROE 17.1%

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

ROCE has stayed above 15% in every year available and stands at 27.0%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 22.4% against a peer median of 17.1% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

ROCE27.0%

ROE22.4%

Peer median ROE17.1%

What is the outlook?

1 analysts covering the stock expect revenue to grow about 45.0% and earnings to grow about 68.2% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+45.0%

Est. earnings growth+68.2%

Analysts1

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 +279% while net margin moved +55% 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+279%

Margin effect+55%

DalalBaazaar Score

61/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Small Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ 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

71/ 100

Good

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

Valuation

47/ 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

84.6x

2Y Median

92.9x

22 monthly readings · mean 100.5x · range 61.3x–151.6x

Sector Median

88.8x

median of 3 sector peers

🟡Currently trading close to its 2y median of 92.9x — the market is paying about what it usually pays for this company.

🟡Against its sector it is priced broadly in line with the peer median of 88.8x.

vs. its own history

Fair

92.9x median over 22 months · -9%

vs. sector peers

Fair

88.8x median of 3 peers · -5%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

84.6x

P/B

20.80x

EV/EBITDA

47.4x

PEG

1.05

Dividend Yield

0.07%

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 20.9% to 25.1% over 3 years.
Return on equity is rising
ROE has improved from 18.4% to 22.4%.
High return on capital employed
ROCE of 27.0% 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

Debt is rising
Total debt is up 279% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 279% over 3 years, from ₹11 Cr to ₹40 Cr.
🔴High leverageFinancial
Debt/Equity of 5.20x — earnings must service borrowings before shareholders see anything.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹49 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 27.0% 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 20.9% to 25.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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 5.20x. Interest is payable whether or not the business has a good year.
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
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.
Several serious flags at once
2 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 42% a year✓ 56.0% CAGR
Latest reported year was 31.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 23%✓ 25.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹49 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 24%✓ 27.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 12 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
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 2 neutral · 4 weak

Market Cap

₹11,276 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

84.6x

Expensive

Expensive — verify against sector peers

P/B Ratio

20.80x

Rich

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

EPS (TTM)

₹17.21

Profitable

Profitable on a per-share basis

ROE

22.4%

Strong

Strong capital efficiency

ROCE

27.0%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

5.20x

High

High leverage

Revenue Growth (YoY)

31.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

49.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.07%

Modest

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

Free Cash Flow

-₹49 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹1,456

P/E (Forward)

35.8x

Improving

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

Operating Margin

15.9%

Good

Healthy core-business profitability

Net Margin

13.3%

Good

Strong bottom-line conversion

Current Ratio

2.48

Comfortable

Healthy short-term liquidity

52W Range Position

80%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1541.5 / 1432.0

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

43.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹247 Cr	₹292 Cr	₹331 Cr	₹936 Cr	+56.0%
EBITDA	₹52 Cr	₹68 Cr	₹119 Cr	₹235 Cr	+65.8%
EBITDA Margin	20.9%	23.3%	36.0%	25.1%	—
PAT (Net Profit)	₹21 Cr	₹37 Cr	₹66 Cr	₹121 Cr	+80.6%
EPS	₹2.86	₹5.2	₹9.1	₹15.67	+76.3%
ROE	18.4%	24.4%	15.6%	22.4%	—
ROCE	28.1%	33.6%	18.3%	27.0%	—
Total Debt	₹11 Cr	₹38 Cr	₹9 Cr	₹40 Cr	+55.9%
Free Cash Flow	₹29 Cr	₹4 Cr	₹38 Cr	-₹49 Cr	—

🟢 Revenue has grown at 56.0% a year over 3 years.

🟢 EBITDA has grown at 65.8% a year over 3 years.

🟢 EBITDA Margin has risen from 20.9% to 25.1% over 3 years (+4.2 pts).

🟢 PAT (Net Profit) has grown at 80.6% a year over 3 years.

🟢 EPS has grown at 76.3% a year over 3 years.

🟢 ROE has risen from 18.4% to 22.4% over 3 years (+4.0 pts).

🔴 ROCE has fallen from 28.1% to 27.0% over 3 years (-1.2 pts).

🔴 Total Debt has grown at 55.9% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹29 Cr to -₹49 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,112 Cr

Total Liabilities

₹339 Cr

Total Debt

₹40 Cr

Cash & Equivalents

₹184 Cr

Operating Cash Flow

₹80 Cr

Capex

-₹129 Cr

Shareholding (proxy)

Institutional Holding

5.3%

Insider Holding

75.5%

Corporate Actions

Dividend Rate

₹1

Ex-Dividend Date

22 Sept 2026

Analyst Consensus

Recommendations

1 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,550

+6.5% vs CMP

Target Range

₹1,550 – ₹1,550

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 positive1 mixed4 general

Quality Power subsidiary starts PCS manufacturing in Türkiye

scanx.trade, 17 Oct

Quality Power Electrical Equipments Ltd is Rated Buy

MarketsMojo, 16 Oct

Quality Power Electrical Equipments Profit Rises 26% to Rs 467 Cr in Q1

HDFC Sky, 10 AugResults

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

Quality Power Electrical Equipments Ltd. Actuals & Estimates (NSE:QPOWER)

TradingView, 26 Jun

Quality Power Electrical Equipments Share Price Target 2026 Analyst Forecast Bull and Bear Case

Univest, 29 JunAnalyst view

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

Concerns Surrounding Quality Power Electrical Equipments' (NSE:QPOWER) Performance

Simply Wall Street, 22 May

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong15.4/20

🟡Financial HealthAdequate9.9/20

🟢GrowthStrong14.9/20

🟢ProfitabilityStrong12.9/15

🔴ValuationDemanding5.3/15

🔴RiskHigh2.9/10

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 42% a year56.0% CAGR
✓EBITDA margin holds above 23%25.1%
✗Free cash flow remains positive-₹49 Cr
✓Debt / EBITDA stays below 2x0.2x
✓ROCE stays above 24%27.0%