Vruddhi Engineering Works Limited

Industrials — Specialty Industrial Machinery · BSE

₹150.00₹0.00 (0.00%)

DalalBaazaar Score

70 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

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

In simple words: Strong business and financial position, with both sales and profits growing well. Nothing obvious stands out as stretched — the usual checks on business quality and management still apply.

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 Vruddhi Engineering Works Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Vruddhi Engineering Works Limited designs, engineers, and supplies rebar couplers, and mechanical splicing solutions to the real estate, construction, and infrastructure industries in India.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees102

Annual revenue₹43 Cr

How does it make money?

Turns over ₹43 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 102 employees supports ₹42.2 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹42.2 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.

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 38.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 30.8% 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.

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 +229% while net margin moved +24% 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+229%

Margin effect+24%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of -0.32 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

72/ 100

Good

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

Valuation

81/ 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

12.3x

3Y Median

43.2x

32 monthly readings · mean 53.6x · range 25.4x–123.9x

Sector Median

66.2x

median of 4 sector peers

🟢Current valuation is approximately 72% below its 3y median of 43.2x. 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 81% below the peer median of 66.2x.

vs. its own history

Cheap

43.2x median over 32 months · -72%

vs. sector peers

Cheap

66.2x median of 4 peers · -81%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.0x

PEG

0.21

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 10.5% to 12.8% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
High return on capital employed
ROCE of 38.3% 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 Attention2

Return on equity is falling
ROE has dropped from 35.5% to 26.7% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 42.8% to 38.3% — often a sign of competition or overexpansion.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 96% over 3 years, from ₹3 Cr to ₹6 Cr.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 37% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 38.3% 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 10.5% to 12.8%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 72% 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 81% 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?

Returns on shareholder capital are falling
ROE has dropped from 35.5% to 26.7%. 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.
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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 37% a year✓ 48.7% CAGR
Latest reported year was 64.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 12.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 35%✓ 38.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 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

8 good · 3 neutral · 0 weak

Market Cap

₹38 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

12.3x

Cheap

Cheap against the generic band

P/B Ratio

3.28x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹12.2

Profitable

Profitable on a per-share basis

ROE

30.8%

Strong

Strong capital efficiency

ROCE

38.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.55x

Low

Conservative leverage

Revenue Growth (YoY)

64.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

83.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

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

Free Cash Flow

₹0 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

ROA

15.4%

Good

Assets are working hard

Operating Margin

9.8%

Average

Average margins

Net Margin

7.2%

Average

Average bottom-line conversion

Current Ratio

1.59

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.32

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

164.1 / 183.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

6.0

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹13 Cr	₹22 Cr	₹32 Cr	₹43 Cr	+48.7%
EBITDA	₹1 Cr	₹2 Cr	₹3 Cr	₹6 Cr	+59.0%
EBITDA Margin	10.5%	7.4%	9.4%	12.8%	—
PAT (Net Profit)	₹1 Cr	₹1 Cr	₹1 Cr	₹3 Cr	+59.9%
EPS	₹2.99	₹3.11	₹5.91	—	—
ROE	35.5%	21.3%	17.6%	26.7%	—
ROCE	42.8%	37.7%	26.0%	38.3%	—
Total Debt	₹3 Cr	₹3 Cr	₹5 Cr	₹6 Cr	+25.1%
Free Cash Flow	-₹4 Cr	₹0 Cr	-₹5 Cr	₹1 Cr	—

🟢 Revenue has grown at 48.7% a year over 3 years.

🟢 EBITDA has grown at 59.0% a year over 3 years.

🟢 EBITDA Margin has risen from 10.5% to 12.8% over 3 years (+2.3 pts).

🟢 PAT (Net Profit) has grown at 59.9% a year over 3 years.

🔴 ROE has fallen from 35.5% to 26.7% over 3 years (-8.8 pts).

🔴 ROCE has fallen from 42.8% to 38.3% over 3 years (-4.5 pts).

🔴 Total Debt has grown at 25.1% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹4 Cr to ₹1 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹21 Cr

Total Liabilities

₹9 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹2 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

84.3%

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

1 positive5 general

Vruddhi Engineering Works Limi Share Price - Live VRUDDHI Stock Price & Chart

Upstox, 05 May

Vruddhi Engineering Works schedules AGM for September 30, 2026

scanx.trade, 30 Sept

Vruddhi Engineering Works Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 30 Aug

Vruddhi Engineering FY26 Results: Net profit up 106% to ₹308 lakh

scanx.trade, 08 OctResults

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

SJP ULTRASONICS LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 08 Oct

Vruddhi Engineering Works makes dull debut, lists at 1.4% premium

Moneycontrol.com, 03 Apr

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

StrongFinancial Health · Growth · Valuation

MiddlingBusiness Quality · Profitability

WeakRisk

Points for each in the Score ↑

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

All 5 tripwires holding · see Key things to watch ↑