ScoreWhy is Varroc Engineering Ltd ?
1
Low ability to service debt as the company has a high Debt to EBITDA ratio of 3.78 times
- Low ability to service debt as the company has a high Debt to EBITDA ratio of 3.78 times
2
Healthy long term growth as Operating profit has grown by an annual rate 24.29%
3
The company has declared Positive results for the last 3 consecutive quarters
- ROCE(HY) Highest at 19.06%
- DEBT-EQUITY RATIO(HY) Lowest at 0.54 times
- OPERATING PROFIT TO INTEREST(Q) Highest at 6.74 times
4
Stock is technically in a Mildly Bullish range
- The technical trend has improved from Sideways on 19-May-26 and has generated 4.18% returns since then
- The stocks Bollinger Band and KST technical factors are also Bullish
5
With ROCE of 21.2, it has a Fair valuation with a 4.2 Enterprise value to Capital Employed
- The stock is trading at a discount compared to its peers' average historical valuations
- Over the past year, while the stock has generated a return of 14.86%, its profits have risen by 39.5% ; the PEG ratio of the company is 0.9
6
Falling Participation by Institutional Investors
- Institutional investors have decreased their stake by -0.96% over the previous quarter and collectively hold 15.8% of the company
- These investors have better capability and resources to analyse fundamentals of companies than most retail investors
Real-Time Research ReportHow much should you hold?
- Overall Portfolio exposure to Varroc Engineer should be less than 10%
- Overall Portfolio exposure to Auto Components & Equipments should be less than 30%
(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Auto Components & Equipments)
When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock
Is Varroc Engineer for you?
High Risk, High Return
Absolute
Risk Adjusted
Volatility
Varroc Engineer
62.06%
0.41
36.24%
Sensex
-1.65%
-0.49
12.94%
Quality
Management Risk
Growth
Capital StructureQuality key factors
Factor
Value
Sales Growth (5y)
-6.04%
EBIT Growth (5y)
29.53%
EBIT to Interest (avg)
1.68
Debt to EBITDA (avg)
4.14
Net Debt to Equity (avg)
0.38
Sales to Capital Employed (avg)
2.83
Tax Ratio
35.83%
Dividend Payout Ratio
24.95%
Pledged Shares
0
Institutional Holding
15.47%
ROCE (avg)
8.66%
ROE (avg)
12.75%
ValuationValuation Key Factors 
Factor
Value
P/E Ratio
42
Industry P/E
39
Price to Book Value
7.11
EV to EBIT
25.55
EV to EBITDA
15.57
EV to Capital Employed
5.42
EV to Sales
1.40
PEG Ratio
0.91
Dividend Yield
0.18%
ROCE (Latest)
20.23%
ROE (Latest)
15.97%
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TechnicalsTechnical key factors
Indicator
Weekly
Monthly
MACD
Bullish
Bullish
RSI
Bearish
No Signal
Bollinger Bands
Bullish
Bullish
Moving Averages
Bullish (Daily)
KST
Bullish
Bullish
Dow Theory
Mildly Bullish
Mildly Bullish
OBV
Bullish
Bullish
Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned 
Financial Trend18What is working for the Company
PAT(Latest six months)
At Rs 146.59 cr has Grown at 36.46%
ROCE(HY)
Highest at 19.20%
DEBT-EQUITY RATIO(HY)
Lowest at 0.52 times
NET SALES(Q)
Highest at Rs 2,634.24 cr
OPERATING PROFIT TO INTEREST(Q)
Highest at 7.24 times
PBT LESS OI(Q)
Highest at Rs 108.18 cr.
-1What is not working for the Company
NO KEY NEGATIVE TRIGGERS
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Here's what is working for Varroc Engineer
Net Sales - Quarterly
Highest at Rs 2,634.24 cr and Grown
each quarter in the last five quartersMOJO Watch
Near term sales trend is very positive
Net Sales (Rs Cr)
Operating Profit to Interest - Quarterly
Highest at 7.24 times
in the last five quartersMOJO Watch
The company's ability to manage interest payments is improving
Operating Profit to Interest
Profit Before Tax less Other Income (PBT) - Quarterly
Highest at Rs 108.18 cr. and Grown
each quarter in the last five quartersMOJO Watch
Near term PBT trend is very positive
PBT less Other Income (Rs Cr)
Profit After Tax (PAT) - Latest six months
At Rs 146.59 cr has Grown at 36.46%
Year on Year (YoY)MOJO Watch
Near term PAT trend is positive
PAT (Rs Cr)
Debt-Equity Ratio - Half Yearly
Lowest at 0.52 times and Fallen
each half year in the last five half yearly periodsMOJO Watch
The company has been reducing its borrowing as compared to equity capital
Debt-Equity Ratio
Here's what is not working for Varroc Engineer
Non Operating Income - Quarterly
Highest at Rs 6.20 cr
in the last five quartersMOJO Watch
Increased income from non business activities may not be sustainable
Non Operating Income
