Winsol Engineers Limited

Sector n/a · NSE

₹378.85−₹6.95 (−1.80%)

DalalBaazaar Score

59 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

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

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

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

How does it make money?

Turns over ₹137 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 24.7%. Returns that high normally get competed away; when they persist, something is protecting them. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

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 +109% while net margin moved +33% 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+109%

Margin effect+33%

DalalBaazaar Score

59/ 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

65/ 100

Good

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

Valuation

35/ 100

Expensive

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

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

20.0x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 12.0% to 18.5% over 3 years.
High return on capital employed
ROCE of 24.7% 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 59.3% to 22.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 63.5% to 24.7% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 544% over 3 years, from ₹11 Cr to ₹68 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 26082% against revenue up 109% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹46 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 24.7% 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 12.0% to 18.5%. 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?

Returns on shareholder capital are falling
ROE has dropped from 59.3% to 22.5%. 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
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

1Revenue growth stays above 21% a year✓ 27.8% CAGR
Latest reported year was 22.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 16%✓ 18.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹46 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 22%✓ 24.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 9 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
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 6 neutral · 1 weak

Market Cap

₹437 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

22.5%

Strong

Strong capital efficiency

ROCE

24.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.07x

Moderate

Moderate leverage

Revenue Growth (YoY)

22.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

22.1%

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

-₹46 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Gross Margin

43.1%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

10.5%

Good

Strong bottom-line conversion

Current Ratio

1.72

Comfortable

Healthy short-term liquidity

Technical Snapshot

SMA 20 / SMA 50

108.9 / 111.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

50.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹65 Cr	₹78 Cr	₹111 Cr	₹137 Cr	+27.8%
EBITDA	₹8 Cr	₹13 Cr	₹18 Cr	₹25 Cr	+47.6%
EBITDA Margin	12.0%	17.2%	15.8%	18.5%	—
PAT (Net Profit)	₹5 Cr	₹9 Cr	₹12 Cr	₹14 Cr	+40.6%
EPS	₹4.49	₹7.88	₹10.22	—	—
ROE	59.3%	51.7%	23.8%	22.5%	—
ROCE	63.5%	66.6%	31.9%	24.7%	—
Total Debt	₹11 Cr	₹10 Cr	₹17 Cr	₹68 Cr	+86.1%
Free Cash Flow	-₹1 Cr	₹3 Cr	-₹25 Cr	-₹46 Cr	—

🟢 Revenue has grown at 27.8% a year over 3 years.

🟢 EBITDA has grown at 47.6% a year over 3 years.

🟢 EBITDA Margin has risen from 12.0% to 18.5% over 3 years (+6.5 pts).

🟢 PAT (Net Profit) has grown at 40.6% a year over 3 years.

🔴 ROE has fallen from 59.3% to 22.5% over 3 years (-36.7 pts).

🔴 ROCE has fallen from 63.5% to 24.7% over 3 years (-38.8 pts).

🔴 Total Debt has grown at 86.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹158 Cr

Total Liabilities

₹94 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹5 Cr

Capex

-₹51 Cr

Recent News

6 general

Winsol Engineers Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 03 Sept

WINSOL ENGINEERS LIMITED Share Price

Upstox, 05 May

Will Weakness in Winsol Engineers Limited's (NSE:WINSOL) Stock Prove Temporary Given Strong Fundamentals?

Simply Wall Street, 13 Jan

From Merritronix to Winsol Engineers: 73% of SME IPOs made listing gains since 2020. Here's what's changing now

Livemint, 22 Jul

Winsol engineers wins Rs 8.25 crore order from Gujarat energy transmission corporation

scanx.trade, 20 Aug

Stocks to Watch Tomorrow

Dalal Street Investment Journal, 27 Aug

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
Sector/industry classification unavailable — verify manually for peer comparison.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

StrongGrowth · Profitability

MiddlingBusiness Quality · Financial Health · Valuation

WeakRisk

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you. 2 high-severity red flags sit above this conclusion and should be read first.

2 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive · see Key things to watch ↑