Welspun Enterprises Limited

Industrials — Engineering & Construction · NSE

₹723.00−₹4.70 (−0.65%)

DalalBaazaar Score

52 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Low

Driven by small-cap size, which brings sharper price swings, falling profits.

In simple words: Reasonable but unspectacular business quality, but sales are shrinking. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

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

What does this company do?

Welspun Enterprises Limited engages in the engineering, procurement, and construction of infrastructure development projects in India.

IndustryEngineering & Construction

SectorIndustrials

Employees40,000

Annual revenue₹3,408 Cr

How does it make money?

Turns over ₹3,408 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹23 left at the operating level before interest, tax and depreciation. Each of its 40,000 employees supports ₹8.5 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹8.5 lakh

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.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 14.3% 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.

Peer median ROE14.1%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +26% while net margin moved -62% 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+26%

Margin effect-62%

DalalBaazaar Score

52/ 100

Moderate

Weighted across six categories. Every point is explained below.

• Revenue CAGR of 8.0% is steady
✗ Profit has declined at 21.5% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Latest-year revenue growth of -8.4% is below the longer-term trend — momentum is fading
✗ Profit fell 50.0% in the latest year

Quality vs. Valuation

Company Quality

53/ 100

Average

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

Valuation

49/ 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

29.4x

3Y Median

22.4x

40 monthly readings · mean 19.1x · range 5.5x–29.4x

Sector Median

30.1x

median of 3 sector peers

⚠️Current valuation is approximately 31% above its 3y median of 22.4x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟡Against its sector it is priced broadly in line with the peer median of 30.1x.

vs. its own history

Expensive

22.4x median over 40 months · +31%

vs. sector peers

Fair

30.1x median of 3 peers · -2%

vs. generic bands

Fair

15x–35x

EV/EBITDA

14.8x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 11.7% to 23.0% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 30.7% to 11.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 27.3% to 14.3% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 2 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 160% over 3 years, from ₹764 Cr to ₹1,986 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 101% against revenue up 26% — stock may not be moving.
🟡Profit is decliningFinancial
Net profit is down 52% over 3 years.
🟡Receivables growing faster than salesFinancial
Receivables up 56% against revenue up 26% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 11.7% to 23.0%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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 56% against revenue up 26%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 31% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 30.7% to 11.5%. 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
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.
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 21%✓ 23.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Interest cover stays above 3x✓ 4.0x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 6% a year✓ 8.0% CAGR
Latest reported year was -8.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹78 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 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

2 good · 7 neutral · 2 weak

Market Cap

₹9,805 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

29.4x

Fair

Fairly valued against the generic band

P/B Ratio

3.22x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹24.57

Profitable

Profitable on a per-share basis

ROE

11.5%

Moderate

Moderate capital efficiency

ROCE

14.3%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.61x

Moderate

Moderate leverage

Revenue Growth (YoY)

-8.4%

Shrinking

Sales are contracting

Profit Growth (YoY)

-50.0%

Falling

Profits are shrinking

Dividend Yield

0.41%

Modest

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

Free Cash Flow

₹78 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

19.6x

Improving

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

Operating Margin

18.1%

Good

Healthy core-business profitability

Net Margin

8.6%

Average

Average bottom-line conversion

Current Ratio

1.96

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.43

Defensive

Steadier than the market

52W Range Position

72%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

747.5 / 703.8

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

39.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,702 Cr	₹2,827 Cr	₹3,546 Cr	₹3,408 Cr	+8.0%
EBITDA	₹315 Cr	₹556 Cr	₹677 Cr	₹783 Cr	+35.5%
EBITDA Margin	11.7%	19.7%	19.1%	23.0%	—
PAT (Net Profit)	₹723 Cr	₹295 Cr	₹323 Cr	₹350 Cr	-21.5%
EPS	₹48.08	₹21.25	₹23.3	₹25.27	-19.3%
ROE	30.7%	12.7%	12.7%	11.5%	—
ROCE	27.3%	16.9%	16.1%	14.3%	—
Total Debt	₹764 Cr	₹762 Cr	₹1,499 Cr	₹1,986 Cr	+37.5%
Free Cash Flow	₹188 Cr	-₹415 Cr	-₹325 Cr	₹78 Cr	-25.3%

🟢 Revenue has grown at 8.0% a year over 3 years.

🟢 EBITDA has grown at 35.5% a year over 3 years.

🟢 EBITDA Margin has risen from 11.7% to 23.0% over 3 years (+11.3 pts).

🔴 PAT (Net Profit) has shrunk at 21.5% a year over 3 years.

🔴 EPS has shrunk at 19.3% a year over 3 years.

🔴 ROE has fallen from 30.7% to 11.5% over 3 years (-19.2 pts).

🔴 ROCE has fallen from 27.3% to 14.3% over 3 years (-13.0 pts).

🔴 Total Debt has grown at 37.5% a year over 3 years.

🔴 Free Cash Flow has shrunk at 25.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹7,329 Cr

Total Liabilities

₹4,068 Cr

Cash & Equivalents

₹174 Cr

Operating Cash Flow

₹112 Cr

Capex

-₹34 Cr

Shareholding (proxy)

Institutional Holding

10.5%

Insider Holding

64.7%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

03 Jul 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

2 positive1 mixed3 general

Welspun Enterprises (WELENT.NS) Eases 1.44% to ₹725.30 as Stock Holds Above Key Support - Factor ETF Flow

https://www.siam.in/, 12 Oct

Welspun Enterprises Share Price News: Fresh 52-Week Peak

Univest, 21 Aug

Welspun Enterprises (WELENT) Share/Stock Price Live, NSE

TechGraph, 08 Oct

Welspun Enterprises Limited (NSE:WELENT) Looks Interesting, And It's About To Pay A Dividend

Simply Wall Street, 29 JunCapital return

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

WELENT Forecast — Price Target — Prediction for 2027

TradingView, 29 SeptAnalyst view

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

Welspun Corp, Welspun Enterprises hit 52-week highs after order wins; stocks jump up to 5% today

Livemint, 21 SeptOrder 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.

Watch Items

Revenue growth is negative (-8.4%) 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

StrongFinancial Health

MiddlingBusiness Quality · Profitability · Risk

WeakGrowth · Valuation

Points for each in the Score ↑

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

1 of 5 tripwires tripped — Debt / EBITDA stays below 2x · see Key things to watch ↑