Veljan Denison Limited

Industrials — Specialty Industrial Machinery · NSE

₹2,457.90−₹50.10 (−2.00%)

DalalBaazaar Score

67 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by micro-cap size, which brings thin liquidity.

In simple words: Reasonable but unspectacular business quality, with modest growth. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 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 Veljan Denison Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Veljan Denison Limited manufactures and sells hydraulic pumps, motors, valves, and custom-built power packs in India and internationally.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees262

Annual revenue₹164 Cr

How does it make money?

Turns over ₹164 Cr a year. Of every ₹100 of sales, about ₹16 reaches shareholders as profit, with ₹26 left at the operating level before interest, tax and depreciation. Each of its 262 employees supports ₹62.5 lakh of revenue a year, the signature of a people-led business.

EBITDA margin26.3%

Net margin15.8%

Revenue / employee₹62.5 lakh

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 14.0% 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.

ROCE14.0%

ROE10.3%

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 +36% while net margin moved +18% 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+36%

Margin effect+18%

DalalBaazaar Score

67/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 42.2x is demanding — it needs sustained high growth to justify

Quality vs. Valuation

Company Quality

74/ 100

Good

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

Valuation

50/ 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

42.2x

Sector Median

66.2x

median of 4 sector peers

🟢Against its sector it trades 36% below the peer median of 66.2x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

66.2x median of 4 peers · -36%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

42.2x

P/B

4.41x

EV/EBITDA

25.3x

PEG

2.45

Dividend Yield

0.35%

What's Good / What's Bad

🟢 What's Going Well5

Margins are improving
EBITDA margin is up from 23.3% to 26.3% over 3 years.
Debt is being paid down
Total debt is down 88% over 3 years.
Cash generation is improving
Free cash flow is up 448% over 3 years.
Return on capital is rising
ROCE has improved from 11.7% to 14.0%.
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

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?

Margin expansion has further to run
EBITDA margin has risen from 23.3% to 26.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 88% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 36% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹25 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

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

1Revenue growth stays above 8% a year✓ 10.9% CAGR
Latest reported year was 2.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 24%✓ 26.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹25 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 11%✓ 14.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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 · 7 neutral · 1 weak

Market Cap

₹1,106 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

42.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

4.41x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹58.18

Profitable

Profitable on a per-share basis

ROE

10.3%

Moderate

Moderate capital efficiency

ROCE

14.0%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.45x

Low

Conservative leverage

Revenue Growth (YoY)

2.0%

Modest

Modest growth

Profit Growth (YoY)

4.7%

Modest

Slow profit growth

Dividend Yield

0.35%

Modest

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

Free Cash Flow

₹25 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹2,457.9

Operating Margin

21.9%

Good

Healthy core-business profitability

Net Margin

15.9%

Good

Strong bottom-line conversion

Current Ratio

7.60

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.25

Defensive

Steadier than the market

52W Range Position

68%

Mid-range

Technical Snapshot

RSI (14)

66.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹120 Cr	₹137 Cr	₹155 Cr	₹164 Cr	+10.9%
EBITDA	₹28 Cr	₹37 Cr	₹40 Cr	₹43 Cr	+15.4%
EBITDA Margin	23.3%	26.8%	25.8%	26.3%	—
PAT (Net Profit)	₹16 Cr	₹22 Cr	₹24 Cr	₹26 Cr	+17.3%
EPS	₹35.61	₹49.05	₹52.71	₹57.42	+17.3%
ROE	8.7%	10.8%	10.5%	10.3%	—
ROCE	11.7%	14.5%	14.3%	14.0%	—
Total Debt	₹9 Cr	₹7 Cr	₹8 Cr	₹1 Cr	-50.9%
Free Cash Flow	₹5 Cr	₹5 Cr	₹9 Cr	₹25 Cr	+76.4%

🟢 Revenue has grown at 10.9% a year over 3 years.

🟢 EBITDA has grown at 15.4% a year over 3 years.

🟢 EBITDA Margin has risen from 23.3% to 26.3% over 3 years (+3.0 pts).

🟢 PAT (Net Profit) has grown at 17.3% a year over 3 years.

🟢 EPS has grown at 17.3% a year over 3 years.

🟢 ROE has risen from 8.7% to 10.3% over 3 years (+1.6 pts).

🟢 ROCE has risen from 11.7% to 14.0% over 3 years (+2.3 pts).

🟢 Total Debt has shrunk at 50.9% a year over 3 years.

🟢 Free Cash Flow has grown at 76.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹283 Cr

Total Liabilities

₹32 Cr

Total Debt

₹1 Cr

Cash & Equivalents

₹16 Cr

Operating Cash Flow

₹32 Cr

Capex

-₹6 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

86.9%

Corporate Actions

Dividend Rate

₹8.5

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

6 general

Veljan Denison Share Price near 52-week high, fundamentals

Univest, 09 Oct

VELJAN Stock Price and Chart — NSE:VELJAN

TradingView, 20 Apr

Veljan Denison promoter acquires 19.64% stake via inter-se gift

scanx.trade, 05 Oct

Veljan Denison Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

Veljan Denison Ltd Hits All-Time High of Rs 2,736.85 as Momentum Builds Across Timeframes

MarketsMojo, 08 Oct

Veljan Denison Share Price Hits 20% Upper Circuit Today

Univest, 01 Jul

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong14.5/20

🟢Financial HealthStrong17.6/20

🟢GrowthStrong13.3/20

🟢ProfitabilityStrong9.9/15

🔴ValuationDemanding5.7/15

🟡RiskModerate6.2/10

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.

This thesis breaks if

✓Revenue growth stays above 8% a year10.9% CAGR
✓EBITDA margin holds above 24%26.3%
✓Free cash flow remains positive₹25 Cr
✓Debt / EBITDA stays below 2x0.0x
✓ROCE stays above 11%14.0%