Vikran Engineering Limited

Industrials — Engineering & Construction · NSE

₹59.56+₹0.82 (+1.40%)

DalalBaazaar Score

56 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:10 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 Vikran Engineering Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Vikran Engineering Limited operates as an engineering, procurement, and construction company in India.

IndustryEngineering & Construction

SectorIndustrials

Employees881

Annual revenue₹1,248 Cr

How does it make money?

Turns over ₹1,248 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹15 left at the operating level before interest, tax and depreciation. Each of its 881 employees supports ₹1.42 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin14.7%

Net margin7.3%

Revenue / employee₹1.42 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., ADANI PORT & SEZ LTD, SIEMENS LTD. 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%

ADANI PORT & SEZ LTDP/E 29.9x · ROE 14.1%

SIEMENS LTDP/E 88.8x · ROE 10.5%

What is its competitive advantage?Little sign of one

Returns on capital of 13.8% 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.

ROCE13.8%

ROE7.4%

Peer median ROE14.1%

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 +138% while net margin moved -10% 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+138%

Margin effect-10%

DalalBaazaar Score

56/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

55/ 100

Average

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

Valuation

80/ 100

Cheap

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

16.7x

1.3Y Median

23.9x

15 monthly readings · mean 23.9x · range 14.5x–35.3x

Sector Median

30.1x

median of 3 sector peers

🟢Current valuation is approximately 30% below its 1.3y median of 23.9x. 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 45% below the peer median of 30.1x.

vs. its own history

Cheap

23.9x median over 15 months · -30%

vs. sector peers

Cheap

30.1x median of 3 peers · -45%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

16.7x

P/B

1.24x

EV/EBITDA

9.8x

PEG

0.58

Dividend Yield

0.30%

What's Good / What's Bad

🟢 What's Going Well3

Valuation below its historical average
At 16.7x the stock trades 30% below its own median of 23.9x.
Very low debt
Debt/Equity of 0.24x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention5

Debt is rising
Total debt is up 92% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.
Return on equity is falling
ROE has dropped from 32.7% to 7.4% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 44.4% to 13.8% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 174% against revenue growth of 138% — customers are taking longer to pay.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 92% over 3 years, from ₹157 Cr to ₹301 Cr.
🔴Free cash flow negative for 3 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴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.
🟡Receivables growing faster than salesFinancial
Receivables up 174% against revenue up 138% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 30% 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 45% 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?

Sales are being booked faster than collected
Receivables are up 174% against revenue up 138%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 32.7% to 7.4%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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
3 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 25% a year✓ 33.5% CAGR
Latest reported year was -11.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 13%✓ 14.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹440 Cr
Profit that never becomes cash eventually stops being profit.
4Interest cover stays above 3x✓ 3.1x
How much operating profit can fall before interest stops being comfortably covered.
5Debt / EBITDA stays below 2x✓ 1.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.

Investment Checklist

5 / 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

4 good · 4 neutral · 3 weak

Market Cap

₹1,536 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

16.7x

Fair

Fairly valued against the generic band

P/B Ratio

1.24x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹3.57

Profitable

Profitable on a per-share basis

ROE

7.4%

Weak

Weak capital efficiency

ROCE

13.8%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.24x

Low

Conservative leverage

Revenue Growth (YoY)

-11.0%

Shrinking

Sales are contracting

Profit Growth (YoY)

119.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.30%

Modest

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

Free Cash Flow

-₹440 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹59.56

Operating Margin

7.2%

Average

Average margins

Net Margin

7.3%

Average

Average bottom-line conversion

Current Ratio

1.98

Comfortable

Healthy short-term liquidity

52W Range Position

13%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

58.2 / 60.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

51.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹524 Cr	₹777 Cr	₹912 Cr	₹1,248 Cr	+33.5%
EBITDA	₹78 Cr	₹132 Cr	₹156 Cr	₹183 Cr	+32.9%
EBITDA Margin	14.9%	17.0%	17.1%	14.7%	—
PAT (Net Profit)	₹43 Cr	₹75 Cr	₹78 Cr	₹92 Cr	+28.9%
EPS	₹1.66	₹2.9	₹3.02	₹4.05	+34.6%
ROE	32.7%	25.7%	16.6%	7.4%	—
ROCE	44.4%	42.0%	30.4%	13.8%	—
Total Debt	₹157 Cr	₹184 Cr	₹274 Cr	₹301 Cr	+24.3%
Free Cash Flow	₹5 Cr	-₹69 Cr	-₹132 Cr	-₹440 Cr	—

🟢 Revenue has grown at 33.5% a year over 3 years.

🟢 EBITDA has grown at 32.9% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 14.7% over 3 years.

🟢 PAT (Net Profit) has grown at 28.9% a year over 3 years.

🟢 EPS has grown at 34.6% a year over 3 years.

🔴 ROE has fallen from 32.7% to 7.4% over 3 years (-25.3 pts).

🔴 ROCE has fallen from 44.4% to 13.8% over 3 years (-30.6 pts).

🔴 Total Debt has grown at 24.3% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹5 Cr to -₹440 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,504 Cr

Total Liabilities

₹1,266 Cr

Total Debt

₹301 Cr

Cash & Equivalents

₹33 Cr

Operating Cash Flow

-₹437 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

5.4%

Insider Holding

85.4%

Corporate Actions

Dividend Rate

₹0.18

Ex-Dividend Date

28 Aug 2026

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
ADANI PORT & SEZ LTD	29.9x	14.1%
SIEMENS LTD	88.8x	10.5%

Recent News

1 positive3 mixed2 general

Vikran Engineering Ltd Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

Vikran Engineering Share Price and Stock Analysis

Kalkine India, 13 Oct

Vikran Engineering Share Price Target 2027 to 2030: Analyst Outlook

Univest, 18 AugAnalyst view

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

Vikran Engineering share price jumps 13%: How ₹2,941 crore IREDA loan boosts solar project prospects

Livemint, 13 OctPrice 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.

Vikran Engineering shares rally nearly 12% on securing ₹154 crore order from Power Grid

Upstox, 24 SeptPrice 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.

Vikran Engineering sets Aug 28 record date for ₹0.18 dividend

scanx.trade, 28 AugCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Watch Items

Revenue growth is negative (-11.0%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟡Business QualityAdequate9/20

🟡Financial HealthAdequate11.8/20

🟢GrowthStrong14.9/20

🔴ProfitabilityWeak5.8/15

🟢ValuationAttractive12/15

🔴RiskHigh2.4/10

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. 3 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 25% a year33.5% CAGR
✓EBITDA margin holds above 13%14.7%
✗Free cash flow remains positive-₹440 Cr
✓Interest cover stays above 3x3.1x
✓Debt / EBITDA stays below 2x1.6x