INOXINDIA - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 4.0

📊 Core Financials:

- Quarterly PAT at ₹57.1 Cr vs ₹60.4 Cr previously → slight decline but YoY profit variation strong (15.5%).

- ROCE at 37.0% and ROE at 27.9% → excellent efficiency and profitability.

- Debt-to-equity ratio at 0.10 → very low leverage, strong balance sheet.

- Dividend yield at 0.18% → minimal payouts, reinvestment focus.

💹 Valuation Indicators:

- Current P/E: 43.8 vs Industry P/E: 28.9 → trading at a premium.

- P/B ratio: ~10.2 (₹1,132 / ₹111) → expensive valuation.

- PEG ratio: 2.18 → stretched valuation relative to growth.

- Intrinsic value appears lower than CMP, suggesting premium pricing.

🏢 Business Model & Competitive Advantage:

- Inox India specializes in cryogenic equipment and industrial gas solutions.

- Competitive advantage lies in niche expertise, strong demand from energy, healthcare, and industrial sectors.

- Market cap of ₹10,274 Cr reflects growing relevance in specialized engineering and industrial solutions.

📈 Entry Zone & Long-Term Guidance:

- CMP ₹1,132 is below DMA 50 (₹1,167) and DMA 200 (₹1,154), showing short-term weakness.

- RSI at 39.0 and MACD negative → near oversold zone, accumulation opportunity.

- Suggested entry zone: ₹1,050–₹1,100.

- Long-term holding recommended due to strong fundamentals, low debt, and niche leadership, though valuations are stretched.

Positive

• Strong ROCE (37.0%) and ROE (27.9%).
• Low debt-to-equity ratio (0.10).
• Quarterly PAT variation of 15.5% shows growth momentum.
• FII holdings increased by 0.18% and DII holdings by 0.02%.

Limitation

• High P/E (43.8) compared to industry average (28.9).
• P/B ratio ~10.2 indicates expensive valuation.
• PEG ratio of 2.18 suggests stretched valuation relative to growth.
• Dividend yield at 0.18% is negligible.

Company Negative News

• Quarterly PAT declined slightly (₹60.4 Cr → ₹57.1 Cr).
• Stock trading below DMA levels with negative MACD, showing weakness.

Company Positive News

• Strong institutional interest with FII and DII holding increases.
• Healthy EPS of ₹26.6 supports earnings visibility.

Industry

• Industrial equipment and cryogenics sector is growing with demand from energy and healthcare industries.
• Industry P/E at 28.9 indicates moderate valuation compared to Inox India’s premium pricing.

Conclusion

⚖️ Inox India is financially strong with excellent return ratios, low debt, and niche market leadership. However, valuations are stretched with high P/E, P/B, and PEG metrics. Entry is favorable around ₹1,050–₹1,100 for long-term investors, with potential for sustained growth in cryogenic and industrial equipment demand.