TIMKEN - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.6

Here’s a crisp yet thorough breakdown of Timken India Ltd. (TIMKEN) — a precision-engineered play in India’s industrial growth story ⚙️📈

📘 Core Financial Assessment

Profitability

Solid EPS of ₹60.5, placing Timken comfortably in the upper tier of industrial stocks.

ROE (17.0%) and ROCE (20.9%) reflect strong capital efficiency and return discipline.

Quarterly Trends

PAT Qtr: ₹104 Cr. vs ₹187 Cr. — indicates a temporary slowdown, likely cyclical.

QoQ Profit Variation: +8.21% — adds nuance, suggesting some earnings recovery.

Capital Structure

Virtually no debt (Debt-to-Equity: 0.01) — exceptional financial resilience.

Dividend Yield: 1.14% — modest but present.

💰 Valuation Snapshot

Indicator Value Interpretation

P/E Ratio 52.2 Richly valued — well above industry average (48.7)

P/B Ratio ~8.3 High, given Book Value of ₹378

PEG Ratio 4.80 🚩Overvaluation alert — growth may not justify price

Intrinsic Value ~₹2,750–₹2,900 Fair value zone — currently overvalued at ₹3,155

Timken trades at a premium, possibly factoring in long-term infrastructure momentum and export growth.

🧬 Business Model & Strategic Advantage

Specializes in high-performance bearings and mechanical components across automotive, railways, wind energy, and industrial.

Strong domestic presence paired with export channels; brand trust & technical edge are major moats.

Benefiting from India’s infrastructure buildout, EV adoption, and defense/railway capex cycles.

📊 Ownership sentiment

FII Holding ↓ –1.24% — mild bearish trimming

DII Holding ↑ +0.88% — local institutions maintaining support

📉 Technical View & Entry Opportunity

RSI: 35.6 — tilting toward oversold zone

MACD: +4.23 — bullish crossover strength

Hovering near DMA 200 (₹3,141) — a key technical level

🎯 Recommended Entry Zone

Ideal for accumulation near ₹2,800–₹2,950

Deep value zone: ₹2,600–₹2,700, particularly during broad market corrections

⏳ Long-Term Holding Guidance

✅ High-quality business with strong balance sheet, niche dominance, and industrial tailwinds

⚠️ Elevated valuation and PEG ratio warrant staggered accumulation or wait-and-watch approach

🟡 Ideal for long-term core holding, especially in portfolios focused on manufacturing, automation, or infrastructure themes

Timken might look pricey at first glance, but few industrials match its engineering pedigree. If you’d like, I can compare it with SKF India, Schaeffler, or NRB Bearings to help sharpen your strategy 🔧📊

Edit in a page