Elecon Engineering Co. Ltd. (ELECON) AI Stock Analysis

• Market Cap: ₹91.56B
• Dividend Yield: 0.41%
• Average Volume (3M): 47.36K
• Price to Earnings (P/E): 19.0
• Beta (1Y): 1.94
• Revenue Growth: 20.94%
• EPS Growth: 45.63%
• Country: IN
• Employees: 1,974
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 3.20
• Shares Outstanding: 224,399,930
• 10 Day Avg. Volume: 66,917
• 30 Day Avg. Volume: 47,361
• PEG Ratio: 1.44
• Price to Book (P/B): 5.01
• Price to Sales (P/S): 4.49
• P/FCF Ratio: 27.32
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: ₹407.00 ▼(-21.37% Downside)

Overall score is driven primarily by strong financial performance (high margins, low leverage, solid cash generation), partially offset by weak technicals (price below major moving averages, negative MACD, low RSI). Valuation is neutral-to-slightly supportive, but the low dividend yield limits upside from an income perspective.

Positive Factors

Revenue Growth

Sustained ~16.8% revenue growth indicates durable demand for engineered MHE and gear solutions. Over 2–6 months this underpins backlog health and pricing leverage, supporting reinvestment, aftermarket expansion, and steadier future cash flows despite cyclical end-markets.

High Profitability

Consistently high gross and EBIT margins reflect differentiated engineered products and execution capability. Durable margin levels support strong operating cash generation, buffer against commodity cost swings, and enable reinvestment in R&D and service capabilities that sustain competitive advantage.

Conservative Leverage

Very low leverage and a strong equity base provide financial flexibility for bidding large EPC projects and funding capex or working capital through cycles. This reduces refinancing risk and preserves capacity for strategic investments or targeted M&A over the medium term.

Negative Factors

Project-based Revenue Cyclicality

Heavy reliance on project/EPC contracts makes revenue timing and margins sensitive to order cycles and execution risk. Delays or slower industrial capex can compress near-term cash flows and margins, creating variability in earnings and working capital needs across quarters.

End-market Concentration

Concentration in heavy industries ties performance to cyclical sectors that are capital expenditure sensitive. Downturns in cement, steel or mining can materially reduce equipment orders and aftermarket demand, increasing revenue and margin volatility over multi-quarter horizons.

Limited Income Appeal

A very low dividend yield limits the stock's appeal to income-oriented investors and suggests less cash returned to shareholders. Over time this can reduce investor base diversification and make share price performance more dependent on growth than steady income streams.

Elecon Engineering Co. Ltd. Business Overview & Revenue Model

Company Description

Elecon Engineering Company Limited manufactures and sells power transmission and material handling equipment in India and internationally. The company operates in two segments, Material Handling Equipment and Transmission Equipment. It provides helical and bevel helical, planetary, worm, high speed, wind turbine, marine, and custom built gear boxes; customized gear boxes; loose gears; vertical roller mill drives; elign geared, elflex flexible, fluid, scoop controlled variable speed controlled fluid, and torsion shaft couplings; and elevator traction machines. The company also provides material handling equipment, such as raw material handling systems, stackers, scrapers/reclaimers, bagging and weighing machines, wagon and truck loaders, crushers, wagon tipplers and associated equipment, feeders, idlers and pulleys, magnates/weighers/detectors, port equipment, and cable reeling drums; and alternate energy products. In addition, it engages in the ferrous and non-ferrous foundry business. Further, the company offers gearbox repair and refurbish services; and material handling equipment support services. Elecon Engineering Company Limited serves cement, sugar, defense, steel, mining, power, plastic, material handling, chemical, palm oil, crane, paper, rubber, marine, and fertilizer industries, as well as windmills and ports. The company was founded in 1951 and is based in Vallabh Vidyanagar, India.

How the Company Makes Money

ELECON generates revenue primarily through the sale of its industrial products, including gearboxes and bulk material handling systems. The company also earns income from providing engineering services, project management, and after-sales support to its clients. Key revenue streams include direct sales to industrial customers, long-term contracts for large-scale projects, and maintenance services. Additionally, ELECON has established partnerships with various firms to enhance its product offerings and expand its market reach, which contributes to its overall earnings. The company's diverse clientele across multiple sectors further stabilizes its revenue sources.

Elecon Engineering Co. Ltd. Financial Statement Overview

Summary

Strong, consistent fundamentals: solid revenue growth (16.8%), high profitability (gross margin 46.7%, net margin 18.6%, EBIT margin 37.3%), conservative leverage (debt-to-equity 0.09), robust ROE (20.8%), and healthy cash conversion (OCF/NI 1.04; FCF/NI 0.88).

Income Statement

Elecon Engineering Co. Ltd. has demonstrated remarkable revenue growth over the years, with the latest annual growth rate being 16.8%. The company maintains strong profitability with a gross profit margin of 46.7% and a net profit margin of 18.6% for the last reported year. Moreover, the EBIT margin stands at 37.3%, showcasing efficient operational management. The consistent revenue growth and robust margins indicate a strong competitive position in the industry.

Balance Sheet

The balance sheet of Elecon Engineering reflects a solid financial structure with a low debt-to-equity ratio of 0.09, indicating conservative leverage. The company exhibits a healthy equity ratio of 73.2%, suggesting strong asset backing. The return on equity is robust at 20.8%, signifying effective utilization of shareholders' funds. The company's strong equity position and prudent leverage management contribute to its financial stability.

Cash Flow

Elecon Engineering's cash flow statement shows a healthy Free Cash Flow growth of 9.9% year-over-year. The operating cash flow to net income ratio is 1.04, indicating efficient cash generation relative to profits. Additionally, the free cash flow to net income ratio stands at 0.88, reflecting effective conversion of profits into cash. The positive cash flow metrics highlight strong cash management and operational efficiency.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	59.47B	22.27B	19.37B	15.30B	12.12B	10.44B
Gross Profit	26.41B	9.89B	8.83B	6.66B	5.31B	4.66B
EBITDA	13.95B	5.28B	4.72B	3.33B	2.49B	1.81B
Net Income	12.10B	4.15B	3.56B	2.38B	1.40B	576.31M
Balance Sheet
Total Assets	29.96B	27.29B	21.24B	17.32B	17.18B	19.93B
Cash, Cash Equivalents and Short-Term Investments	8.19B	7.25B	4.78B	2.29B	871.86M	1.41B
Total Debt	2.58B	1.81B	704.60M	515.76M	1.51B	3.35B
Total Liabilities	7.52B	7.31B	5.20B	4.53B	6.68B	10.73B
Stockholders Equity	22.44B	19.99B	16.04B	12.79B	10.50B	9.19B
Cash Flow
Free Cash Flow	0.00	3.66B	3.33B	2.63B	2.01B	2.44B
Operating Cash Flow	0.00	4.32B	3.65B	3.10B	2.50B	2.48B
Investing Cash Flow	0.00	-3.16B	-2.79B	-1.67B	-118.46M	-186.78M
Financing Cash Flow	0.00	-673.70M	-585.10M	-1.45B	-2.50B	-2.10B

Elecon Engineering Co. Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 517.60
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:ELECON, the sentiment is Negative. The current price of 517.6 is above the 20-day moving average (MA) of 412.21, above the 50-day MA of 456.09, and below the 200-day MA of 559.93, indicating a bearish trend. The MACD of -23.39 indicates Negative momentum. The RSI at 45.07 is Neutral, neither overbought nor oversold. The STOCH value of 85.35 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:ELECON.

Elecon Engineering Co. Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ELECON	67 Neutral	₹91.56B	19.01	―	0.41%	20.94%	45.63%
ELGIEQUIP	66 Neutral	₹137.13B	35.11	―	0.47%	9.46%	18.97%
INGERRAND	66 Neutral	₹105.24B	39.76	―	2.34%	5.68%	9.74%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
CRAFTSMAN	59 Neutral	₹174.45B	52.18	―	0.07%	54.58%	-12.30%
KSB	59 Neutral	₹123.32B	46.96	―	0.51%	9.50%	14.52%
ISGEC	58 Neutral	₹55.49B	29.61	―	0.59%	-4.14%	-35.66%

Elecon Engineering Co. Ltd. Corporate Events

Elecon Engineering Releases Q3 & 9M FY26 Investor Presentation Ahead of Earnings Call

Elecon Engineering Company Limited has released its investor presentation for the third quarter and nine-month period of the 2025-26 financial year, ahead of its scheduled earnings conference call on 9 January 2026. The presentation, now available to stock exchanges and on the company’s website, is intended to brief investors and analysts on the company’s latest financial and operational performance, underscoring Elecon’s ongoing compliance with disclosure regulations and its emphasis on maintaining clear, timely engagement with capital-market stakeholders.

Elecon Engineering Wins Favourable Order in CGST Transport Dispute

Elecon Engineering Company Limited has received a favourable order from the Office of the Deputy Commissioner of State Tax (Appeal), Vadodara, which approved the company’s appeal against an earlier order by the State Tax Officer related to the detention of a transport vehicle over missing documents under Section 129 of the CGST Act. The company had previously paid a disputed penalty of ₹14,01,764 to secure release of the vehicle, and while the refund of this amount is still pending, management has clarified that the latest ruling carries no adverse financial or operational implications, signalling a positive resolution of the tax litigation and removing a potential compliance overhang for stakeholders.

Elecon Engineering Schedules Earnings Call to Discuss Q3 FY26 Performance

Elecon Engineering Company Limited has announced that Elara Securities (India) Private Limited will host an earnings conference call on 9 January 2026 to discuss the company’s financial performance for the quarter and nine months ended 31 December 2025. Senior management, including the heads of the Gear and Material Handling Equipment divisions and the chief financial officer, will participate, signaling the importance of the update for analysts and investors tracking the company’s operational progress and segment-wise performance.

Elecon Engineering Shuts Trading Window Ahead of Q3 FY26 Results Board Meet

Elecon Engineering Company Limited has announced the closure of its trading window for designated persons and their immediate relatives from 1 January 2026 until 48 hours after the conclusion of an upcoming board meeting, in line with SEBI’s Prohibition of Insider Trading Regulations and the company’s internal code of conduct. The board will meet on 8 January 2026 at Vallabh Vidyanagar to consider and approve the unaudited standalone and consolidated financial results, including segment-wise performance, for the quarter and nine months ended 31 December 2025, signalling the next key financial disclosure milestone for investors and other stakeholders.