Forbes Precision Tools and Machine Parts Limited

Industrials — Tools & Accessories · BSE

₹143.80−₹2.30 (−1.57%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

REASONABLE

Risk

Very High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity, a beta above 1.3, so it swings harder than the index.

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, 6:07 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 Forbes Precision Tools and Machine Parts Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Forbes Precision Tools and Machine Parts Limited engages in manufacturing, trading, and servicing of engineering and related products, and machine and machine parts in India. It offers carbide and high-speed steel round cutting tools under the TOTEM brand name.

IndustryTools & Accessories

SectorIndustrials

Employees420

Annual revenue₹249 Cr

How does it make money?

Turns over ₹249 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹22 left at the operating level before interest, tax and depreciation. Each of its 420 employees supports ₹59.3 lakh of revenue a year, the signature of a people-led business.

EBITDA margin22.0%

Net margin11.5%

Revenue / employee₹59.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

What is its competitive advantage?Some evidence

ROCE of 22.3% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE22.3%

ROE17.1%

Peer median ROE15.2%

DalalBaazaar Score

66/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Beta of 1.55 — amplifies market moves in both directions
✗ Micro 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

Quality vs. Valuation

Company Quality

70/ 100

Good

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

Valuation

75/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

21.9x

2Y Median

29.4x

28 monthly readings · mean 32.7x · range 19.0x–61.0x

Sector Median

88.8x

median of 3 sector peers

🟢Current valuation is approximately 26% below its 2y median of 29.4x. 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 75% below the peer median of 88.8x.

vs. its own history

Cheap

29.4x median over 28 months · -26%

vs. sector peers

Cheap

88.8x median of 3 peers · -75%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

21.9x

P/B

4.40x

EV/EBITDA

13.7x

PEG

—

Dividend Yield

6.95%

What's Good / What's Bad

🟢 What's Going Well4

Return on equity is rising
ROE has improved from -30.9% to 17.1%.
Return on capital is rising
ROCE has improved from -30.9% to 22.3%.
High return on capital employed
ROCE of 22.3% is the mark of a business that converts capital into profit efficiently.
Valuation below its historical average
At 21.9x the stock trades 26% below its own median of 29.4x.

🔴 What Needs Attention0

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

Red Flags

2 items require attention · 2 high

🔴High leverageFinancial
Debt/Equity of 9.87x — earnings must service borrowings before shareholders see anything.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 22.3% 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.
Priced below its own history
The stock trades 26% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 75% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 9.87x. 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
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.
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

1EBITDA margin holds above 20%✓ 22.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹9 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 19%✓ 22.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 29.4x✓ 21.9x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

10 / 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

7 good · 3 neutral · 1 weak

Market Cap

₹742 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

21.9x

Fair

Fairly valued against the generic band

P/B Ratio

4.40x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹6.58

Profitable

Profitable on a per-share basis

ROE

17.1%

Strong

Strong capital efficiency

ROCE

22.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

9.87x

High

High leverage

Revenue Growth (YoY)

28.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

136.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

6.95%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹9 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹143.8

Operating Margin

17.0%

Good

Healthy core-business profitability

Net Margin

12.8%

Good

Strong bottom-line conversion

Current Ratio

1.84

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

1.55

High swing

Swings more than the market in both directions

52W Range Position

41%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

153.3 / 148.7

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

28.7

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	—	₹227 Cr	₹230 Cr	₹249 Cr	—
EBITDA	-₹0 Cr	₹53 Cr	₹54 Cr	₹55 Cr	—
EBITDA Margin	—	23.3%	23.6%	22.0%	—
PAT (Net Profit)	-₹0 Cr	₹30 Cr	₹29 Cr	₹29 Cr	—
EPS	₹-0	₹5.76	₹5.57	₹5.58	—
ROE	-30.9%	21.6%	17.3%	17.1%	—
ROCE	-30.9%	27.0%	22.3%	22.3%	—
Total Debt	—	₹9 Cr	₹22 Cr	₹17 Cr	—
Free Cash Flow	—	-₹88 Cr	₹23 Cr	₹9 Cr	—

🟢 EBITDA has turned positive, from -₹0 Cr to ₹55 Cr.

🔴 EBITDA Margin has fallen from 23.3% to 22.0% over 3 years (-1.2 pts).

🟢 PAT (Net Profit) has turned positive, from -₹0 Cr to ₹29 Cr.

🟢 EPS has turned positive, from ₹-0 to ₹5.58.

🟢 ROE has risen from -30.9% to 17.1% over 3 years (+48.0 pts).

🟢 ROCE has risen from -30.9% to 22.3% over 3 years (+53.2 pts).

🟢 Free Cash Flow has turned positive, from -₹88 Cr to ₹9 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹251 Cr

Total Liabilities

₹83 Cr

Total Debt

₹17 Cr

Cash & Equivalents

₹6 Cr

Operating Cash Flow

₹28 Cr

Capex

-₹18 Cr

Shareholding (proxy)

Institutional Holding

8.9%

Insider Holding

76.4%

Corporate Actions

Dividend Rate

₹10

Ex-Dividend Date

18 Aug 2026

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

1 positive1 mixed4 general

Forbes Precision Tools And Machine Parts Ltd. Peer Comparison – Compare with Others

Value Research, 27 Aug

Forbes Precision Tools Q1FY27 net profit surges 137% to ₹9.03 crore

scanx.trade, 12 AugResults

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

Forbes Precision Tools Share Price: Technicals and Valuation

Univest, 12 Aug

Le Travenues Technology Q2 Profit Hits Rs 63 Cr; Shares Allotted

Whalesbook, 17 OctResults

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

Forbes Precision Tools And Machine Parts Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 03 Sept

Forbes Precision Tools and Machine Parts Ltd. Share Price Live Today

CNBC TV18, 03 Jan

Watch Items

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 QualityStrong16.7/20

🟢Financial HealthStrong13.9/20

🟡GrowthModest10/20

🟢ProfitabilityStrong12/15

🟢ValuationAttractive11/15

🔴RiskHigh2.6/10

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 20%22.0%
✓Free cash flow remains positive₹9 Cr
✓Debt / EBITDA stays below 2x0.3x
✓ROCE stays above 19%22.3%
✓Valuation vs its own median of 29.4x21.9x today