Fundamental Analysis of Stocks

JSW Steel has become India’s largest steel manufacturer by market capitalization, overtaking Tata Steel. While other steel manufacturers are facing operational challenges, global headwinds, JSW Steel continues to expand its footprint, both in India and overseas, through aggressive brownfield expansions and capacity additions at existing plants.

In this article, we will take a closer look at JSW Steel share price performance, operational strength, and the long-term growth outlook. Let’s dive in. 

JSW Steel Business Overview

JSW Steel is one of India’s largest integrated steel manufacturers. Founded in 1994, it has grown into a global player with exports to 100+ countries.

The annual steel production capacity is 38.5 million tonnes with its six operational plants in India and the US. 

In India, it has plants in Vijaynagar, Dovi, Salem, Tarapur, Vasind, and Kamleshwar. The Vijaynagar plant is India’s biggest single-location steel plant. 

It has a diverse product portfolio, including flat products, long & special steel, and value-added steel products (VASP), which contribute nearly 60% of the sales. 

The company is recognized for its innovative products. It has a technological partnership with JFE Steel of Japan for the manufacturing of high-strength automotive wheels. And has also won many accolades for its sustainability efforts. 

JSW Steel is recognised as a 2025 Sustainability Champion by the World Steel Association for the 7th consecutive year.

JSW Steel Leadership Team

Mr Sajjan Jindal is the Chairman and Managing Director of JSW Steel and also the principal promoter of the company. 

Mr Jayant Acharya is the Joint Managing Director and CEO. He started his career in the year 1986 with SAIL. With over three decades of experience in the metal & mining industry, Mr Acharya played a key role in the growth of JSW Steel. He holds a Bachelor’s degree in Chemical Engineering, a Master’s degree in Physics from BITS Pilani, and an MBA degree. 

Mr Gajraj Singh Rathore is the Whole‑Time Director & COO of the company. He has over 35 years of experience in the steel industry and has been with JSW Steel for the past 27 years. He played a key role in the successful expansion and capacity utilization at Vijaynagar and other steel plants. 

Mr Arun Sitaram Maheshwari is the Director (Commercial & Marketing) of JSW Steel and has been with the company for over 28 years. During his tenure, he played a key role in the sourcing of raw materials for the steel and power businesses, shaping corporate strategy, and international presence. Mr Arun holds a B.Com and an MBA degree. 

Mr Swayam Saurabh is the CFO and has been with the company since July 2023. A chartered accountant by profession, Mr Swayam was earlier associated with companies like Arvind, Ola, Hindustan Zinc, Philips, etc. 

JSW Steel Shareholding Pattern

In the domestic institution segment, mutual funds hold a 3.54% stake in JSW Steel, and LIC holds a 6.45% stake. 

And, in the foreign institution segment, JFE Steel International Europe B.V., the technological partner of JSW Steel, holds a 15% stake in the company. 

JSW Steel Financials

Revenue From Operations

In FY25, the company’s revenue from operations declined by 3.5% year-on-year to ₹1,68,824 crores.

The decline in revenue came despite 6.7% year-on-year growth in sales volume. Globally, steel prices have moderated, which has affected the top-line growth of many steel companies. 

In Q1FY26, the company’s revenue from operations increased marginally to ₹43,147 crores from ₹42,943 crores. Total sales volumes during the quarter were at 6.69 MT, up 9% YoY. 

EBITDA

In FY25, EBITDA declined by 19% on a year-on-year basis to ₹22,904 crores from ₹28,236 crores. The decline in EBITDA is due to lower sales realisation on account of moderate steel prices and lower EBITDA from Bhushan Power & Steel. 

For the Q1FY26 period, EBITDA improved 37.5% to ₹7,576 crores from ₹5,510 crores in Q1FY25. This is due to lower raw material costs and a higher share of premium products in total sales. 

Net Profit

In FY25, the net profit of JSW Steel declined by more than 60% year-on-year to ₹3,491 crores from ₹8,973 crores in FY24. 

For Q1FY26, the net profit of the company increased by 154% on a year-on-year basis to ₹2,209 crores from ₹867 crores in Q1FY25. 

Key Financial Metrics 

Current Ratio: In FY25, the current ratio of JSW Steel improved 22% to 1.06 times from 0.87 times in FY24. The increase is primarily due to an increase in cash and cash equivalents, investments in mutual funds, and lower trade payables. 

Debt-to-equity Ratio: Due to higher borrowing, the debt-to-equity ratio of the company increased to 0.82 times in FY25 from 0.78 times in FY24. 

Debt Service Coverage Ratio: In FY25, the debt service coverage ratio of the company declined by 20.7% to 2.42 times from 3.05 times in FY24. The decline is primarily due to lower profits during the financial year. 

Return on Capital Employed (ROCE): The ROCE of the company declined to 8.59% in FY25 from 12.90% in FY24, primarily due to decreased profit levels. 

JSW Steel Share Price Analysis

In the last five years, JSW Steel share price has increased from ₹205 (21st July 2025) to ₹1,031 (23rd July 2025), a rise of almost 405% in 5 years. Its 52-week high level is ₹1,075. 

It has a consistent track record of paying dividends to shareholders. In the last three financial years, it has paid ₹3.40 (FY23), ₹7.30 (FY24), and ₹2.80 (FY25) as dividends. 

At the current JSW Steel share price of ₹1,031, the dividend yield stands at 0.27%.

JSW Steel Share Price: Future Growth Potential 

The steel industry is cyclical, meaning its performance is directly dependent on the state of the economy. When economic growth slows, demand for steel drops, making it tough for businesses. 

Because of this, companies like JSW Steel see high variations in revenue and profit growth. Their valuation tends to stay low, with modest P/E, due to the unpredictability in earnings. 

Generally, cyclical stocks are best bought when they’re out of favor and sold when businesses boom. As the economy recovers and demand picks up, these stocks usually rally. After 2020, we have seen a strong rally in commodity stocks, including steel. 

But mis-timing your entry can hurt your returns. Buying during peak performance leaves little room for upside.

Positives for JSW Steel Share Price

• Favorable cost dynamics. The price of both key raw materials, coking coal and iron ore, is expected to remain soft, helping to improve cost efficiencies. 

• Volumes are expected to improve in Q2FY26, as planned plant shutdowns are expected to conclude. And, the addition of new capacities coming on-stream. 

• Increasing the share of securing raw materials from captive sources: In FY26, the management expected the company to meet 40% of its iron ore requirement from its sources, up from 37% in FY25. For coking coal, the company doesn’t possess any captive mines as of now. But expects production from the Moitra mine (captive) to commence from June 2026. High captive share is essential for both quality, control over steel prices, and earnings stability. 

Negatives for JSW Steel Share Price

• The global economy is experiencing a period of volatility, influenced by tariff escalations and ongoing geopolitical tensions. This uncertainty has led the IMF to lower its 2025 global forecast.
  
• A sharp revival in Chinese steel demand is a major cause of concern, leading to depressed domestic steel prices. Also, FTAs with Vietnam, Korea, and Japan continue to pose a risk.
  
• While management expects coking coal prices to remain lower, volatility in iron ore prices can impact margins.
  
• Legal uncertainty surrounds Bhushan Power & Steel Ltd’s acquisition. The Supreme Court has rejected JSW Steel’s resolution plan for BPSL and has directed refunds of amounts paid to creditors and equity contributions.

Driven by volume growth, a higher share of premium products in revenue, and shoring up its captive sources, JSW Steel offers a compelling growth story. However, the cyclical nature of the industry should be considered before investing in JSW Steel. 

FAQ

How has JSW Steel share price performed in the last five years?

JSW Steel has been a multibagger stock in the last five years. JSW Steel share price increased from  ₹205 (21st July 2025) to ₹1,031 (23rd July 2025), a rise of almost 405% in 5 years.

Who owns JSW Steel?

JSW Group owns JSW Steel and is headed by Mr. Sajjan Jindal.

Is JSW Steel profitable?

Yes, JSW Steel is a profitable steel manufacturer. In FY25, its net profit was ₹3,491 crores on sales of ₹168,824 crores. 

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

Since 2024, Larsen & Toubro share price is moving sideways with no real wealth creation for investors. 

But, if you look at the company’s operational performance, revenue and profitability growth has been healthy during the period. 

So, why is Larsen & Toubro share price struggling to move higher despite a strong operational performance? 

We will do a deep dive analysis of Larsen & Toubro share price, what is impacting its performance, and the future growth outlook of the company.

Larsen & Toubro Business Overview

Larsen & Toubro (L&T) is one of India’s most respected multinational conglomerates, headquartered in Mumbai. Founded in 1938 by Danish engineers Henning Holck-Larsen and Søren Kristian Toubro, the company is a diversified engineering and infrastructure giant. 

It operates in key sectors like construction, engineering, heavy equipment manufacturing, defense, information technology (through subsidiaries like L&T Infotech and L&T Technology Services), financial services, energy, and power. 

L&T has now expanded its operations to more than 30 countries, with more than 50% revenue now coming from outside India. The company plays a critical role in India’s development journey and is widely regarded as a benchmark in project execution and engineering excellence. 

L&T Leadership Team

Mr. S. N. Subrahmanyan is the Chairman & Managing Director and has been with L&T since 1984, joining as a Project Planning Engineer. Under his leadership, the company has completed many key infrastructure projects, including the Statue of Unity, Atal Setu, K9 Vajra Tank, Ayodhya Ram Mandir, and has geographically expanded the company. Mr. Subrahmanyan did his B.Tech in civil engineering from NIT Kurukshetra, a postgraduate degree in business management from Symbiosis Institute of Business Management, Pune, and also did an Executive Management Program from London Business School. 

Mr. Subramanian Sarma is the Deputy Managing Director & President of L&T Group. He oversees the energy portfolio of the company, which comprises hydrocarbons, green & clean energy, asset management & offshore wind business. Mr. Sarma is a chemical engineering graduate and did his master’s from IIT Mumbai. 

Mr. R. Shankar Raman is the President and Chief Financial Officer of L&T. He joined the L&T group in 1994 and played a key role in setting up L&T Finance. A qualified Chartered Accountant and a Cost Accountant, Mr Raman is responsible for the entire finance function at the group level.

L&T Shareholding Pattern

L&T is a professionally managed company with 100% shareholding held by the public. Nearly 20% of the stake is held by mutual fund houses in India, and LIC holds a 13.25% stake in the company. 

Larsen & Toubro Financials

Revenue From Operations

In FY25, L&T’s revenue from operations increased by 16% to ₹2.55 lakh crore from ₹2.21 lakh crore in FY24. 

Over the last five years, revenue from operations has increased by 13.47% annually.

Speaking about the revenue composition, the company earns a lion’s share, i.e., 51% of its revenue from the infrastructure segment, followed by 26% from the services segment and 16% from the energy segment. 

Source: Company Presentation

Looking at the geographical distribution of revenue, nearly 50% of the revenue is earned in India, 31% came from the Middle East, 16% from USA & Europe, and 3% from the rest of the World.

EBITDA

L&T’s EBITDA increased by 13% year-on-year to ₹26,435 crores in FY25, from ₹23,494 crores in FY24. 

Looking at the trend of EBITDA margin, it is on a slight declining trend. The margin has declined from 11.49% in FY21 to 10.34% in FY25, a fall of 105 basis points. 

Falling EBITDA margin also indicates increased competition in verticals it operates, and the company is sacrificing its profitability to win orders.

Net Profit

Barring FY22, the net profit of L&T has been consistently rising over the five-year period. In FY25, the net profit increased 13.7% to ₹17,673 crores from ₹15,547 crores in FY24. 

Key Financial Metrics

Debt-equity Ratio: At the end of FY25, the company’s debt-to-equity improved by 12.7% to 0.31 times from 0.35 times in FY24. 

Debt Service Coverage Ratio: The company’s ability to service debt has improved significantly in FY25, improving to 2.14 times from 1.84 times in FY24. 

Return on Equity: The ROE measures the returns on shareholders capital. It has recovered much of fall since 2022. In FY25, ROE improved to 15.94%, from 13.71% in FY24, due to increased profits.

	FY21	FY22	FY23	FY24	FY25
ROE (%)	20.5	12.2	11.3	13.71	15.94

Return on Capital Employed: The ROCE, which measures the returns on total capital employed (shareholders’ capital + debt), also improved to 13.45% in FY25 from 12.25% in FY24. 

Larsen & Toubro Share Price Analysis

Over the last five years, Larsen & Toubro share price has become a multi-bagger, rising from around the ₹900 level in July 2020 to currently trading at the ₹3,480 level (15th July 2025). 

However, if you look, the Larsen & Toubro share price has been trading sideways since 2024.

Larsen & Toubro has a consistent track record of paying dividends. In the last three financial years, the company paid ₹24 (FY23), ₹34 (FY24), and ₹34 (FY25) as dividends to shareholders. 

At the current price of ₹3,497, the dividend yield comes to 0.97%. 

Larsen & Toubro Share Price Valuation Metrics

Earning Per Share (EPS)

Over the last five years, the EPS of the company has improved, but not significantly. After a decline in FY22, it has been rising. The company has added only ₹27 to its EPS over the five-year period, explaining the sideways performance in the Larsen & Toubro share price. 

	FY21	FY22	FY23	FY24	FY25
EPS (₹)	82.49	61.71	74.51	93.96	109.36

Price-to-Book Value (P/B Ratio)

As of 15th July 2025, the book value of Larsen & Toubro is ₹710 and is trading at a Price-to-Book value of 4.9 times. 

The 5-year median price-to-book value is 3.7 times, largely indicating the stock is trading at a sight premium compared to its historical valuation. 

Source: Screener

Price-to-Equity Ratio (PE Ratio)

L&T stock is trading at a PE of 31.5 times, meaning, for every ₹1 of earnings, you are paying ₹31.5 as a premium. 

The median 5-Year PE is 30.8 times, indicating the Larsen & Toubro share price is trading at a fair valuation compared to its historical valuation. 

Source: Screener

Larsen & Toubro Share Price: Future Growth Potential

Order Inflows

During the year, the company posted a record order inflow of ₹3.57 lakh crore, up by 18% on a year-on-year basis. 

This resulted in a total order book of ₹5.8 lakh crore in FY25, up from ₹4.76 lakh crore in FY24. With a strong order book, it gives a multi-year revenue visibility. 

Strategic Growth Initiatives

The company has expanded its presence in the Hydrocarbons, CarbonLite, Green, and Clean Energy sectors. Out of the total order book of ₹5.8 lakh crore, ₹1.4 lakh crore is in the Hydrocarbon segment, which the company is focusing on as its next growth drivers. 

Regarding the order book distribution, approximately 46% is International, with a significant portion from the Middle East. 

It is also focusing on new growth drivers in Renewables, Green Hydrogen, and Offshore Wind. L&T is also stepping up its capital allocation into green energy, data centres, and semiconductor design. 

FY26 Guidance

Larsen & Toubro’s management has provided the following guidance for FY26:

• Group order inflows are expected to grow by 10% for FY26.
• Group revenues are expected to grow by 15% for FY26.
• The target margin for the Projects and Manufacturing portfolio is 8.5% for FY26.
• The Net Working Capital to Revenue guidance for March 2026 is 12%.
• The company expects that the revenue and margin targets set for FY26 will become more visible in the second half of FY26.

Risks and Challenges

Global Macro Uncertainty: Marked by continuing trade and military conflicts, corrosion of globalization, disruption in the supply chain, and higher financial market volatility.

Subdued Growth in Services Segment: The IT and Technology Services business is reporting subdued growth, reflecting the global macroeconomic environment impacting spending across the developed world.

Competition in Domestic Market: L&T is facing high competition in the domestic market, resulting in L&T being selective in its domestic order acquisition, especially in sectors like Water and Thermal Power.

Oil Price Volatility Impact on Hydrocarbon Projects: While most international infrastructure projects are not sensitive to oil prices, the Hydrocarbon business (about 60% of international order prospects) could see delays if oil prices fall drastically. 

Localization Requirements in the Middle East: As L&T grows in the Middle East, there is an aspiration for local participation, which necessitates investments in ramping up capacity and engaging local contractors. This could impact margins as L&T needs to factor in these costs.

FAQ

How has Larsen & Toubro share price performed over the last five years?

Larsen & Toubro share price has become a multibagger over the last five years, rising from around ₹900 level in July 2021 to currently trading at ₹3,480 level (15th July 2025). 

What does Larsen & Toubro do?

Larsen & Toubro is an infrastructure development company offering engineering, construction, technology, and manufacturing for its customers.

Who are the promoters of Larsen & Toubro?

Larsen & Toubro is a professionally managed company with 100% shares held by the public. 

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

Among the large IT companies in India, Tech Mahindra has largely performed better than its peers. As of 9th May 2025, Tech Mahindra share price has risen by nearly 180% in the last 5 years, while Infosys and TCS share prices have risen by 123% and 81% respectively. 

What has helped Tech Mahindra to outperform its peers? Will the growth momentum continue, and impact on Tech Mahindra share price? We will discuss it all in this article. Read till the end. 

Brief Overview of Tech Mahindra 

Headquartered in Pune, Tech Mahindra provides a wide range of services in IT, business process outsourcing (BPO), network services, and digital transformation. The company operates in 100+ countries and serves clients across BFSI, Telecom, healthcare, manufacturing, and retail. 

While TCS and Infosys’ core industry strengths are BFSI, retail, and manufacturing, Tech Mahindra has a strong focus on telecom & communication. The company serves 9 of the top 10 telcos across the prioritized markets.

In FY24, Tech Mahindra earned nearly ₹52,000 crores, 37% of its revenue from Communications and Media & Entertainment.

Tech Mahindra Management Team

Mr. Mohit Joshi is the CEO & Managing Director of Tech Mahindra. He joined the company in 2023, and before that, he was President at Infosys and had been with the company for 22 years. Mr. Mohit has an MBA degree from FMS Delhi and a bachelor’s degree in history from St. Stephen’s College, Delhi. 

Mr. Atul Soneja is the Chief Operating Officer and has joined the company in August 2023. Earlier, he was the CEO of CitiusTech. Mr. Atul has also served in the leadership ranks at Infosys as a senior vice president. He holds a B.Tech degree in Ocean Engineering and Naval Architecture from IIT Kharagpur. 

Mr. Rohit Anand is the Chief Financial Officer and has been associated with the company since November 2020. He has a rich experience of over 20 years in various functional roles. Before joining Tech Mahindra, he was the CFO of GE Healthcare. Mr. Rohit holds a BA and MA degree in Economics from the prestigious Delhi School of Economics. 

Mr. Richard Lobo is the Chief People Officer and has joined the company in January 2024. Prior to joining Tech Mahindra, he was with Infosys for nearly 23 years, and his last role in the company was Executive Vice President & Head Human Resources. Mr. Lobo did PGDM in Marketing & Finance from XIM Bhubaneswar and BE (Mechanical Engineering) from Manipal Institute of Technology. 

Tech Mahindra Shareholding Pattern

Mutual Funds hold 17% stake in the company, LIC holds 10% stake, and retail individuals holding nominal share capital up to ₹2 lakh hold 6.7% stake. 

Tech Mahindra Financials

Revenue from Operations

In FY25, Tech Mahindra reported a marginal increase of 1.9% in revenue from operations, from ₹51,996 crores in FY24 to ₹52,988 crores. In fact, the company has failed to report any meaningful growth in revenue from operations in the last three years. 

Looking at the geographical distribution of revenue accounts, in FY24, the company earned 51% of its revenue from the Americas, 24% from Europe, and 24% from the rest of the world. In Q4FY25, the company also earned nearly 50% of its revenue from the US market. 

There is a risk that all IT companies face, which derives most of its revenue from the US market. We will discuss that in the article’s last section.

EBITDA 

Tech Mahindra improved its operating margins in FY25. At the end of FY25, EBITDA rose by 40.8% to ₹6,991 crores from ₹4,964 crores in FY24. EBITDA margin improved from 9.5% to 13.2%.

However, the operating margins are still below the FY23 levels. It was 18% in FY22 and 15% in FY23.

Net Profit

The net profit of the company improved by 77.4% on a year-on-year basis to ₹4,253 crores in FY25 from ₹2,397 crores recorded in FY24. 

Key Financial Metrics

Current Ratio: Tech Mahindra’s current ratio declined slightly to 1.9 times in FY24 from 2.07 times in FY23.

Debt-to-equity Ratio: The company has marginal debt on its books. At the end of FY24, it had 2% debt on its total equity capital base. 

Return on Equity (ROE): In FY24, the ROE of the company declined significantly by 40%, from 14.69% in FY23 to 8.8% in FY24.

Return on Capital Employed (ROCE): ROE and ROCE are the vanity metrics that every smart investor tracks closely. It shows how much return the company is making on all invested capital. 

In FY24, ROCE of Tech Mahindra dropped to 11.89% from 19.72% in FY23. However, in FY25, the company improved its returns metrics significantly. ROCE improved from 14.6% in Q4FY24 to 22.6% in Q4FY25, reversing the loss.

Days Sales Outstanding (DSO): DSO is an important metric that shows in how many days the company collects money from clients. In this front, Tech Mahindra is constantly improving this metric. From 97 days in FY22, they have reduced it to 88 days. Lower DSO indicates better cash cycle management. 

Tech Mahindra Share Price Performance

Tech Mahindra share price was trading at ₹510 level on 15th May 2020, and it rose to ₹1,494 level on 9th May 2025. An increase on nearly 3 times in five years. The 52-week high level of Tech Mahindra share price is ₹1,808.

The company has a consistent track record of paying dividends to shareholders. In FY24, it paid ₹40 as dividends, and in FY25, it paid ₹45 as dividends. At the current share price of ₹1,494, the dividend yield of Tech Mahindra is 2.68%. 

Tech Mahindra aims to distribute 85% of its free cash flow as dividends or buybacks over the next five years. 

Tech Mahindra Share Price Valuation Analysis

Earnings Per Share (EPS)

The EPS growth of Tech Mahindra in the last five years is stable. After falling in FY24, it has recovered in FY25, but is still below the FY21 levels.  

Period	FY21	FY22	FY23	FY24	FY25
EPS (₹)	45.73	57.27	49.60	24.14	43.43

Price-to-Book Value (P/B Ratio)

As of 9th May 2025, Tech Mahindra share price is trading at a price-to-book value of 5.3 times. The median 5-year Price-to-book value is 4.4 times, largely indicating the stock is trading at a slight premium compared to its book value. 

Price-to-Equity Ratio (PE Ratio)

As of 9th May 2025, Tech Mahindra share price is trading at a PE of 34.4. Meaning that for every ₹1 of earnings, you are paying ₹34.4 as a premium. The 5-year median PE of the Tech Mahindra share price is 25.8 times, indicating that the stock is trading at a premium valuation compared to its historical averages.

Tech Mahindra Share Price: Future Growth Potential

Tech Mahindra has posted steady growth in FY25 despite challenging macro conditions. The steady performance was backed by large deal wins and the strengthening of its BFSI portfolio. It secured 15+ new logos (deals) in the BFSI space, including 3 in Fortune 500 companies. 

Tech Mahindra is improving its domain expertise in payments, wealth, and core banking. 

The value of the new deal wins in FY25 is $2.7 billion, 43% y-o-y growth, which gives some growth direction for the FY26 period. 

Backed by strong deals and a superior execution strategy, Tech Mahindra is aiming to expand its EBIT margin by 530 bps in the next two financial years, from 9.7% in FY25 to 15% in FY27. 

All in all, Tech Mahindra is in a fundamentally sound place to capture growth and opportunities in the next few years. However, one of the biggest risks is regional concentration. 

Tech Mahindra earns nearly 50% of its revenue from the US markets. The market is currently witnessing a slowdown-like condition. In the first quarter of 2025, the US GDP shrank by 0.3%.

In an article published in ET Wealth about the state of Indian IT companies, BNP Paribas stated, a 1.5 percentage point dip in the US GDP growth could hit Indian IT services revenue growth by 5.1 percentage points. Certainly, it is coming out as a major risk for Indian IT companies. 

Also, a strong rupee can squeeze margins for the companies as well. 

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

FAQ

Himachal Futuristic Communications Limited (HFCL) is a leading optical fiber cable manufacturer in India, and its recent foray into defense manufacturing has attracted interest from many investors. HFCL share price, a small-cap stock, has also surged in the last five years and has multiplied investors’ wealth by over 10 times. 

But, the valuation concerns in small-cap stocks and uncertainty in the market due to geopolitics have impacted HFCL’s share price growth. The stock has corrected by almost 50% in the last six months. 

In this article, we will check out the future growth potential of HFCL share price and the overall business using several metrics. So, let’s start.

HFCL Business Overview

HFCL is primarily a telecom equipment manufacturing company. It deals in Fibre and Fibre Optic Cables, Routers, Wi-Fi access Points, Antennas, Network Management Solutions, and other Passive Networking Components.

The company was incorporated in 1987 and has played a crucial role in the expansion of 2G, 3G, 4G mobile networks in India over the years. A turnaround moment for the company came in 2021, when Reliance invested ₹138 crore in the company’s QIP, taking up a 5% stake. 

HFCL’s core business is divided into three segments- Public Communication, Railway Communication, and Defence Communication.

It is India’s number one optic fiber cable supplier, manufacturing over 14 million KM of optic fibre with five state-of-the-art manufacturing facilities and R&D centres. 

HFCL Management Team

Mr. Mahendra Nahata is the founder and managing director of HFCL and leads the company’s planning, execution, and operational strategies. An experienced and skilled leader in the telecom industry, Mr Nahata has served on the Board of Governors of many prestigious institutions like IIT-Bombay, IIT-Madras, and IIIT-Allahabad. He has majored in commerce at St. Xavier’s College, Kolkata. 

Mr. V.R. Jain is the company’s chief financial officer. He is a qualified chartered accountant and company secretary. He has vast experience in financial management and controls, managing and raising funds for business expansion, policy formulation, and many other areas of finance. Mr Jain has previously worked with Gujarat Heavy Chemicals Ltd. and TransAsia Carpets Limited. 

Mr. Harsh Pagay is Executive Vice President, leading the company’s  Optical Fiber (OF) and Optical Fiber Cables (OFC) business. He did his MBA from ICFAI Hyderabad and a B.Tech from MITS Gwalior, and before joining HFCL, he was with Teracom Limited as its CEO.

Mr. Jitendra Singh Chaudhary is the Executive President of communications and is responsible for the growth of the communication business, including Defense and railways. He is a PGDM holder from IIM, Calcutta, and a B.Tech from MMM Engineering College, Gorakhpur.

HFCL Shareholding Pattern

Quant Mutual Fund holds an 8.30% stake in the domestic institution segment, and Reliance has reduced its stake to 1.57%.

The promoters have pledged their shares, and at the end of December 2024, 47% of their stake is pledged. These have been running since 2021 and were used as collateral to secure credit facilities from lenders. 

HFCL Financials

Total Income

HFCL’s revenue in FY24 declined 4.6% year-on-year to ₹4,566 crores from ₹4,790 crores. 

And, for the period 9MFY25 (April to December 2024), the revenue increased slightly by 2.8% to ₹3,308 crores from ₹3,216 crores recorded in the previous year. 

Nearly 97% of the revenue is derived from the telecom segment, 2% from Railways, and 1%Defenseefense. 

Revenue Share Mix

The company’s revenue share from private customers in FY24 was 74%, which declined to 60%. Due to higher inflows of government orders recently, revenue from government orders are increasing. 

Second, the share of exports in revenue is hovering around 11%.

And, third, in FY24, product led revenue share has been 42%, in CY24, it has increased to 57%. The remaining share is coming from projects like EPC services. 

EBITDA

Despite the slight decrease in revenue in FY24, the company’s EBITDA has increased by 2.4%. And, in 9MFY25, EBITDA rose by nearly 12% to 529.08 crores. 

In FY24, the company’s EBITDA margin improved to 15.28% from 14.04% in FY23. And, for the 9MFY25, it further increased to 16.21%, highlighting operational efficiency. 

Net Profit

In FY24, the company’s net profit rose 6% to ₹337.52 crores. And, profit during the period 9MFY25 was ₹256.56 crores, increasing by 12.45% from ₹228.16 crores. 

PAT Margin in FY24 was 7.56%, rising from 6.70% in FY23. And, for 9MFY25, the PAT margin improved slightly to 7.86%. 

Key Financial Metrics

Current Ratio: The current ratio of HFCL improved marginally to 2.04 times in FY24 from 1.94 times in FY23.

Debt-to-equity Ratio: The debt-to-equity ratio was stable at 0.20 times in FY24, while the debt service coverage ratio improved by 12% to 7.22%. 

Return on Equity (ROE): The ROE of the company increased slightly to 9.09 times in FY24 from 8.90 times in FY23. 

Return on Capital Employed (ROCE): The ROCE of the company slightly declined by 3.45% to 14.85%, from 15.36% in FY23. 

Other Important Metrics

Order Book

At the end of December 2024, the company’s outstanding order book stood at ₹10,410 crores. It was ₹6,151 crores at the end of September 2024. 

As seen in the image below, a large part of the order book consists of government orders under the Bharat Net program. 

R&D Capabilities

HFCL has three state-of-the-art R&D centers in Bengaluru, Hyderabad, and Gurugram, with a team strength of 380 employees and around 10% of the total employees in the market. At the end of FY24, the total number of employees in the company was 3,547.

Now, looking at the R&D spending trend of the company, it has nearly tripled its expenses towards it from ₹89 crore in FY22 to ₹233 crore in FY24.

Period	FY22	FY23	FY24
R&D expenditure as a percentage of total turnover	2.06%	4.03%	5.72%

HFCL Share Price Analysis

HFCL share price has underperformed the broader market and has lost nearly half its value in the last six months. However, if you look at the previous five years’ price action of HFCL share price, it is still a multi-bagger stock. It was a penny stock trading around ₹10 on 24th April 2020. As of 9th April 2025, the stock’s current value is ₹74.3 and has a market cap of ₹11,000 crores. HFCL share price reached an all-time high level of ₹171. 

The stock has a dividend payment history but has been on the lower side. At a current market price of ₹74.3, the dividend yield of HFCL is 0.27%. In FY24, it paid ₹0.20 per share as a dividend to shareholders. 

HFCL Share Price Valuation Metrics

Earnings Per Share (EPS)

The company’s EPS has improved over the last five years but has stagnated over the last three years, which has impacted HFCL’s share price growth. 

Period	FY20	FY21	FY22	FY23	FY24	9MFY25
EPS (₹)	1.77	1.86	2.27	2.18	2.29	1.79

Price-to-Book Value (P/B Ratio)

As of 9th April 2025, HCL share price is trading with a price-to-book value of 2.6 times. The median 5-year Price-to-book value is 3.6 times, indicating the stock is trading below the 5-year median P/B ratio. 

The stock’s P/B ratio has declined from the peak of 6.8 times, recorded in September 2024. 

Price-to-Equity Ratio (PE Ratio)

As of 9th April 2025, HFCL share price is trading at a current PE of 29.3 times, which means that for every ₹1 of earnings, you are paying ₹29.3 as a premium. The 5-year median PE of the HFCL share price is 31 times, which means the stock is trading at a discount over a long duration.

The stock PE has fallen from 62.5 times, recorded in September 2024. 

HFCL Share Price What’s Next

HFCL’s share price has struggled for the last few months due to stagnated revenue, profit growth, and a sell-off in small-cap stocks. However, the company is well poised to capture growth because of the steps taken in the last few years.

• HFCL’s entry into the defense business segment is a big boost for the company, and it has signed multiple contracts with the Indian armed forces. 

• The company has invested significantly in ramping up its R&D efforts to drive innovation. R&D spending has tripled in the last three years. The company slowly migrates from project-led to product-led revenue growth to lower working capital requirements and drive margin expansion.

• The company’s order book stands strong at more than ₹10,000 crore, however, concentration of government orders can be a risk. Driven by defense business and global expansion, the company aims to become a ₹10,000 crore revenue enterprise.

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

FAQs

India’s gaming and entertainment industry is booming, with live concerts and fine dining. Many startups, including Eternal (Zomato), have invested to capitalize on this Indian’s newfound interest.  One company that has established its dominance in the gaming and entertainment industry is Delta Corp. The company is a dominant casino gaming player in India and owns the biggest online poker platform, Adda52. 

However, due to business challenges in the last few years, Delta Corp share price has declined from ₹285 on March 17, 2022, to ₹87 on March 11, 2025, over the past three years. In its recent presentation, the management has reported an improvement in business performance. This article will analyze Delta Corp’s share price to understand its future growth potential. 

Let’s dive in 

Delta Corp Business Overview

Delta Corp is a leading casino gaming company in India, with over 2,000 live gaming positions, both offshore and onshore. The company has a strong presence in the states of Goa and Sikkim in the casino gaming segment and online skill gaming through the Adda52 poker platform. 

The offshore casino gaming is offered primarily through two vessels- Deltin Royale, Deltin JAQK, and Kings Casino. The onshore casino is offered at Deltin Suites in Goa.

The online gaming segment is divided into three sub-segments-  real-money games (RMG), mobile-centric/casual games, and e-sports.

The RMG segment includes real-poker, daily fantasy sports, and quizzing. Delta Corp is also into the hospitality segment, complementing the gaming business. The Deltin Daman is the largest hospitality project of the group, while Deltin Suites in Goa is equipped with a land-based casino.

Delta Corp Management Team

Mr. Jaydev Mody is the Chairman of Delta Corp and has over 40 years of experience in business growth and management. Mr. Mody, a Humanities graduate from Mumbai University, has played a key role in developing various significant and landmark real estate projects in and around Mumbai, including India’s first global mall, ‘Crossroads,’ in South Mumbai.

Mr Ashish Kapadia has been the Managing Director at Delta Corp since April 2009. He holds a bachelor’s degree in commerce and has established and managed various business sectors like paints, textiles, financial services, and aviation. 

Mr Anil Malani is the company’s President and Chief Financial Officer, with over 35 years of experience across multiple sectors. He has led the company as its ‘President – Operations’ for the past 14 years and was in charge of the group’s casino and hospitality businesses.

Mr Manoj Jain is the Chief Operating Officer and has been with the company since July 2008, holding several key positions. He is in charge of the entire operations of Delta Corp’s major portfolio of assets, Deltin Casinos & Hotels.

Delta Corp Shareholding Pattern

Delta Corp Financial Statement

Revenue From Operations

In FY24, the company’s revenue from operation declined by 4% to ₹925 crores from ₹964 crores recorded in FY23. And, for the nine months- April to December 2024, revenue from operations declined to ₹563 crores from ₹730 crores recorded in the same period the previous year. 

Business Segments	FY23	FY24	9MFY24	9MFY25
Casino Gaming	825	813 (-1.5%)	639	522 (-18.3%)
Online Skill Gaming	162	147 (-9.5%)	112	124 (10.7%)
Hospitality Division	49	51 (4.54%)	37	36 (-2.7%)

Regarding the segment-wise business performance, Casino Gaming brings over 80% of the company’s revenue. In FY24, online skill gaming (Adda52) dragged revenue growth with a 9.5% de-growth in business. For the current financial year, the casino business is witnessing de-growth, and revenue from operations has been down by over 18% in the first nine months.

Know More:  SEBI Registered Investment Advisory |  Stock Investment Advisory

Net Profit 

In FY24, the company’s net profit declined by 6.56% to ₹245 crores from ₹262 crores recorded in FY23.  And, in 9MFY25, the company profit declined by more than 50% to ₹84 crores, compared to ₹172 crores recorded in the same period the previous year. 

Delta Corp Key Financial Ratios

Current Ratio: The company’s current ratio at the end of FY24 was 3.55 times, compared to 4.65 times in FY23. 

Operating Profit Margin (OPM): The OPM of the company reduced to around 25% in FY24, compared to 30.2% in FY23. 

Net Profit Margin: The net profit margin declined to 26.4% in FY24, compared to 27.20% in FY23. 

Return on Net Worth (RoNW): The RoNW of the company in FY24 was 13.81%, slightly higher than 13.25% in FY23.

Delta Corp is a debt-free company whose debt-to-equity ratio is not applicable. 

Delta Corp Share Price Analysis

Delta Corp share price has been an underperformer in the stock market over various periods.  The last five years’ returns of Delta Corp share price is around 40%, rising from ₹63 on 20th March 2020 to ₹88 on 13th March 2025. Delta Corp share price made an all-time high level of ₹328 on 8th April 2022. 

The primary reasons for the fall in Delta Corp’s share price decline in revenue and the GST-related issues. The Indian government levies 28% GST on total money deposited with online skill gaming platform operators, significantly increasing tax impact on business. 

Delta Corp has a consistent track record of paying dividends to shareholders. In the last three years, the company’s dividend payout has been constant at ₹1.25 per share.  The company has maintained a dividend payout ratio of lower than 20%, which indicates it is a low dividend-paying company. 

Key Financial and Valuation Metrics

Earning Per Share (EPS)

The following is the last five-year EPS Of Delta Corp:

Period	FY20	FY21	FY22	FY23	FY24	9MFY25
EPS (₹)	6.85	-0.90	2.51	9.77	9.12	3.15

The company’s EPS growth has been inconsistent in the last five years, which has impacted the growth of Delta Corp’s share price. 

For the 9MFY25 period, the EPS came in at ₹3.15, which is lower than ₹6.42, recorded for the same period the previous year. Therefore, for the full FY25, the EPS growth is likely negative, which may impact Delta Corp share price. 

Price-to-Equity VS Median PE

At the current Delta Corp share price of ₹88, the stock is trading at a PE of 20.1 times and 5 years median PE of 22.7, which indicates the stock is trading at a slight discount in price-earnings.

Price-to-Book VS Median Price-to-Book

Delta Corp’s current price-to-book value is 0.9 times, and the 5-year median price-to-book value is 2.2 times, which indicates the stock is trading at a significantly lower valuation. 

Delta Corp SWOT

Delta Corp is a leader in the online rummy and poker segment with its Adda52 platform. The group now sells it to Head Digital Works, which operates A23 Rummy and A23 Poker. 

It is the second largest deal in the online rummy and poker segment, and Head Digital Works is acquiring it for ₹491 crores. Delta Corp had bought Adda52 for ₹182 crores in 2016. The development came as the segment witnessed intense regulatory scrutiny and higher GST levy, which was dragging on earnings for Delta Corp.

One of the significant threats for Delta Corp is its businesses, which are concentrated in two states, Goa and Sikkim. Further, regulatory hurdles restrict it from expanding to other states.

Another big threat is that being a discretionary spending sector, an economic downturn or slowdown in consumption negatively impacts the growth of the business. The company is witnessing a similar kind of situation in the current fiscal. 

However, to reduce the concentration risk- the company is diversifying to the real estate sector. Delta Corp is establishing a real estate development platform in a strategic partnership with Alpha Alternatives Fund Advisors LLP and Peninsula Land. It will invest ₹765 crores in  Residential Redevelopment projects and land parcels in the Mumbai Metropolitan Region (MMR).

To strengthen its casino business, the company is doubling its gaming positions from 2000 to 4000 with a capex of ₹350 crores by the end of FY25. 

Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.

FAQs