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

• Market Cap: ₹84.46B
• Dividend Yield: 0.41%
• Average Volume (3M): 47.36K
• Price to Earnings (P/E): 37.5
• Beta (1Y): 1.87
• 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): 18.33
• Revenue Forecast (FY): ₹25.49B

• Rating: 73 Outperform
• Price Target: ₹424.00 ▼(-18.08% Downside)
• Action: Reiterated Date: 02/04/26
• Date: Action: Reiterated 02/04/26

The score is primarily driven by strong financial performance (growth, margins, low leverage, and solid cash generation). Offsetting this is a weaker technical picture with the stock trading below key medium/long-term moving averages and a negative MACD. Valuation is supportive but not a major upside catalyst given the modest dividend yield.

Positive Factors

Strong Profitability

Elevated gross and operating margins point to durable product pricing power and manufacturing efficiency in engineered equipment. Such sustained profitability supports reinvestment into R&D and service capabilities, funds working capital for projects, and underpins long-term return on capital.

Conservative Balance Sheet

Very low leverage and a strong equity base provide resilience through capex cycles and reduce refinancing risk. This financial flexibility enables selective bidding on large EPC contracts, supports counter-cyclical investment, and preserves capacity to fund aftermarket growth without heavy external debt.

High Cash Conversion

Consistent operating cash conversion and growing free cash flow indicate the business reliably turns profits into cash. That strengthens funding for capex, spare parts inventory, and service networks, lowering dependence on external financing and supporting sustainable operations and returns.

Negative Factors

Project-based Revenue Dependence

Heavy reliance on engineered, project-based contracts creates lumpy revenue and earnings timing risk. Profitability and cash flow depend on securing and executing large projects; execution delays, cost overruns, or slow collections can materially affect multi-quarter results and backlog visibility.

Cyclical End-market Exposure

Concentration in capital‑intensive, cyclical industries means demand is tied to commodity cycles and industrial capex. Prolonged downturns in these sectors can reduce order intake and aftermarket demand, pressuring utilization and margins across the project and gearbox businesses.

Limited Forward Guidance

Absence of formal forward guidance reduces visibility into near-term demand and management priorities. For a project-centric business, limited disclosure makes forecasting backlog conversion and future cash flows harder, increasing uncertainty around execution, capex planning, and investor assessment.

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 makes money primarily by selling engineered industrial equipment and related services across two main businesses. (1) Material Handling Equipment (MHE): Revenue is generated from designing, manufacturing, supplying, erecting, and commissioning bulk material handling systems and equipment (typically project-based/EPC or equipment-supply contracts) for industrial customers. Earnings in this segment are driven by contract wins, the value and complexity of projects, and execution/commissioning milestones. The company can also earn ongoing revenue through spares, refurbishment, and maintenance/service support for installed equipment. (2) Industrial Gears: Revenue is generated through the manufacture and sale of industrial gearboxes/geared motors and related power transmission solutions used in sectors such as cement, steel, power, mining, and other process industries. This segment typically includes revenues from standard/catalog products as well as customized gear solutions, with additional recurring income from replacement parts, repairs, and aftermarket servicing over the equipment lifecycle. Across both segments, key factors influencing earnings include order inflow from industrial capex cycles, pricing and product mix (standard vs. engineered-to-order), execution efficiency, and aftermarket/service penetration. Specific details on significant partnerships contributing to earnings are null.

Elecon Engineering Co. Ltd. Financial Statement Overview

Summary

Strong fundamentals supported by high Income Statement (90) and Balance Sheet (88) scores, reflecting solid revenue growth (16.8%), robust margins (net margin 18.6%, EBIT margin 37.3%), low leverage (debt-to-equity 0.09), and healthy returns (ROE 20.8%). Cash flow quality is also strong (85) with good cash conversion (operating cash flow to net income 1.04).

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	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	23.95B	22.27B	19.37B	15.30B	12.12B	10.44B
Gross Profit	10.71B	9.89B	8.83B	6.66B	5.31B	4.66B
EBITDA	5.72B	5.28B	4.72B	3.33B	2.49B	1.81B
Net Income	5.17B	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: Positive
• RSI: Neutral
• STOCH: Positive

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 414.80, above the 50-day MA of 425.29, and below the 200-day MA of 537.34, indicating a bearish trend. The MACD of -11.24 indicates Positive momentum. The RSI at 33.66 is Neutral, neither overbought nor oversold. The STOCH value of 15.89 is Positive, 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	73 Outperform	₹84.46B	37.50	―	0.41%	20.94%	45.63%
ELGIEQUIP	66 Neutral	₹148.50B	39.31	―	0.47%	9.46%	18.97%
INGERRAND	66 Neutral	₹115.33B	38.39	―	2.34%	5.68%	9.74%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
KSB	62 Neutral	₹130.93B	48.57	―	0.51%	9.50%	14.52%
CRAFTSMAN	59 Neutral	₹162.12B	42.81	―	0.07%	54.58%	-12.30%
ISGEC	58 Neutral	₹65.25B	24.01	―	0.59%	-4.14%	-35.66%

Elecon Engineering Co. Ltd. Corporate Events

Elecon Reschedules Analyst and Investor Meet by One Day

Elecon Engineering Company Limited has notified the stock exchanges that its planned analyst and institutional investor meeting has been postponed by one day, from 12 March 2026 to 13 March 2026, due to unforeseen exigencies. The company stated that updated details of the rescheduled meeting will be communicated separately, signaling a minor procedural change with limited expected impact on its operations but relevant for investors and analysts tracking its disclosures.

By formally disclosing this scheduling change under the applicable listing regulations, Elecon underscores its adherence to transparency requirements and timely communication with market participants. While the adjustment is logistical in nature, maintaining clear dialogue around analyst and investor interactions helps support the company’s engagement with the financial community and reinforces its compliance-focused governance practices.

Elecon Engineering Schedules Analyst Plant Visit Under SEBI Disclosure Norms

Elecon Engineering Company Limited has announced that its officials will host a group plant visit for analysts and institutional investors on March 13, 2026, from 3:00 p.m. IST onwards, organized by Share India Securities Limited. The company emphasized that discussions during the visit will be restricted to publicly available information, with no presentations planned and no unpublished price-sensitive information to be shared, and noted that the schedule may change due to exigencies for either the company or participants.

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.