Tenneco Clean Air India Limited

Consumer Cyclical — Auto Parts · NSE

₹457.80−₹2.80 (−0.61%)

DalalBaazaar Score

65 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, small-cap size, which brings sharper price swings, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:00 pm

Understanding the Business

Company site ↗

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

What does this company do?

Tenneco Clean Air India Limited operates as a manufacturer and supplier of clean air and powertrain solutions. The company operates in two segments, clean air and powertrain solutions; and advanced ride technologies.

IndustryAuto Parts

SectorConsumer Cyclical

Employees614

Annual revenue₹5,381 Cr

How does it make money?

Turns over ₹5,381 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 614 employees supports ₹8.76 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹8.76 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.

Compared side by side in Peers ↓

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

ROCE has stayed above 15% in every year available and stands at 64.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 50.4% 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.

Peer median ROE23.0%

What is the outlook?

6 analysts covering the stock expect revenue to grow about 14.4% and earnings to grow about 18.7% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.4%

Est. earnings growth+18.7%

Analysts6

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +12% while net margin moved +41% 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+12%

Margin effect+41%

DalalBaazaar Score

65/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 30.7x already prices in growth
• P/E is close to its own historical median of 37.7x
✗ P/B of 15.42x is a steep premium to book

Quality vs. Valuation

Company Quality

72/ 100

Good

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

Valuation

57/ 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

30.7x

1.1Y Median

37.7x

13 monthly readings · mean 37.9x · range 30.5x–45.5x

Sector Median

45.7x

median of 4 sector peers

🟢Current valuation is approximately 18% below its 1.1y median of 37.7x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 33% below the peer median of 45.7x.

vs. its own history

Fair

37.7x median over 13 months · -18%

vs. sector peers

Cheap

45.7x median of 4 peers · -33%

vs. generic bands

Fair

15x–35x

EV/EBITDA

18.4x

PEG

1.86

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from 13.2% to 18.2% over 3 years.
Cash generation is improving
Free cash flow is up 177% over 3 years.
Return on equity is rising
ROE has improved from 31.5% to 50.4%.
Return on capital is rising
ROCE has improved from 42.0% to 64.3%.
High return on capital employed
ROCE of 64.3% 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 Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 4.29x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 64.3% 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.
Margin expansion has further to run
EBITDA margin has risen from 13.2% to 18.2%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 33% 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 4.29x. Interest is payable whether or not the business has a good year.
Growth barely outpaces inflation
Revenue compounding at 3.9% 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.
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 16%✓ 18.2%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✗ 3.9% CAGR
Latest reported year was 20.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹1,314 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 61%✓ 64.3%
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 · 3 neutral · 3 weak

Market Cap

₹18,477 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

30.7x

Fair

Fairly valued against the generic band

P/B Ratio

15.42x

Rich

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

EPS (TTM)

₹14.89

Profitable

Profitable on a per-share basis

ROE

50.4%

Strong

Strong capital efficiency

ROCE

64.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

4.29x

High

High leverage

Revenue Growth (YoY)

20.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-45.9%

Falling

Profits are shrinking

Dividend Yield

None

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

Free Cash Flow

₹1,314 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

22.8x

Improving

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

Operating Margin

14.2%

Average

Average margins

Net Margin

10.6%

Good

Strong bottom-line conversion

Current Ratio

1.42

Comfortable

Healthy short-term liquidity

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

492.8 / 519.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

22.1

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4,799 Cr	₹5,449 Cr	₹4,870 Cr	₹5,381 Cr	+3.9%
EBITDA	₹632 Cr	₹682 Cr	₹858 Cr	₹978 Cr	+15.7%
EBITDA Margin	13.2%	12.5%	17.6%	18.2%	—
PAT (Net Profit)	₹381 Cr	₹417 Cr	₹552 Cr	₹604 Cr	+16.6%
EPS	₹9.44	₹10.32	₹13.67	₹14.95	+16.6%
ROE	31.5%	42.5%	34.3%	50.4%	—
ROCE	42.0%	56.0%	44.8%	64.3%	—
Total Debt	₹83 Cr	₹63 Cr	₹70 Cr	₹80 Cr	-1.3%
Free Cash Flow	₹474 Cr	₹390 Cr	₹498 Cr	₹1,314 Cr	+40.5%

🟢 Revenue has grown at 3.9% a year over 3 years.

🟢 EBITDA has grown at 15.7% a year over 3 years.

🟢 EBITDA Margin has risen from 13.2% to 18.2% over 3 years (+5.0 pts).

🟢 PAT (Net Profit) has grown at 16.6% a year over 3 years.

🟢 EPS has grown at 16.6% a year over 3 years.

🟢 ROE has risen from 31.5% to 50.4% over 3 years (+18.9 pts).

🟢 ROCE has risen from 42.0% to 64.3% over 3 years (+22.3 pts).

🟡 Total Debt has been broadly flat over 3 years (-1.3% a year).

🟢 Free Cash Flow has grown at 40.5% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,537 Cr

Total Liabilities

₹1,337 Cr

Cash & Equivalents

₹571 Cr

Operating Cash Flow

₹1,429 Cr

Capex

-₹115 Cr

Shareholding (proxy)

Institutional Holding

26.5%

Insider Holding

58.1%

Analyst Consensus

Recommendations

6 Buy · 0 Hold · 1 Sell

Target Price (Mean)

₹629.57

+37.5% vs CMP

Target Range

₹469 – ₹680

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

1 positive2 mixed3 general

Tenneco Clean Air India vs Nifty 50: 6M Return -15.63% vs -6.36%

Univest, 12 Oct

Tenneco Clean Air India Limited (NSE:TENNIND) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

Simply Wall Street, 10 AugAnalyst view

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

Tenneco Clean Air India Ltd Peer Comparison – Compare with Others

Value Research, 30 Aug

Tenneco Clean Air up 4%; JM Fin sees 19% upside, bets on strong order book

Business Standard, 04 JunOrder win

🟢Potentially positiveOrder wins add to future revenue, though the effect depends on the contract's size against annual sales and on when it is executed.

Tenneco Clean Air India Shares Fall 5% on Block Deal

Equitypandit, 12 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.

Tenneco Clean Air India promoter offloads 15% stake worth Rs 3,180 crore; SBI, HDFC MF among buyers

Moneycontrol.com, 12 Aug

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.
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

StrongBusiness Quality · Growth · Profitability

MiddlingFinancial Health · Risk

WeakValuation

Points for each in the Score ↑

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

1 of 5 tripwires tripped — Revenue growth stays above 4% a year · see Key things to watch ↑