ISGEC Heavy Engineering Ltd. (ISGEC) AI Stock Analysis

• Market Cap: ₹65.57B
• Dividend Yield: 0.59%
• Average Volume (3M): 3.77K
• Price to Earnings (P/E): 24.0
• Beta (1Y): 1.79
• Revenue Growth: -4.14%
• EPS Growth: -35.66%
• Country: IN
• Employees: 2,979
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 9.49
• Shares Outstanding: 73,529,510
• 10 Day Avg. Volume: 7,100
• 30 Day Avg. Volume: 3,765
• PEG Ratio: 13.83
• Price to Book (P/B): 2.89
• Price to Sales (P/S): 1.23
• P/FCF Ratio: -35.84
• 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: 58 Neutral
• Price Target: ₹970.00 ▲(12.02% Upside)
• Action: Reiterated Date: 12/10/25
• Date: Action: Reiterated 12/10/25

ISGEC Heavy Engineering Ltd. has strong revenue growth and operational efficiency, but faces challenges with cash flow management and high liabilities. The technical analysis indicates a bearish trend, and the stock is overvalued with a low dividend yield. Addressing cash flow issues and improving market sentiment could enhance the stock's attractiveness.

Positive Factors

Improved operating margins

Sustained gross and mid‑tier operating margins indicate stronger cost control and production efficiency in engineered projects. Higher EBITDA/EBIT margins support reinvestment in capacity, improve project bidding competitiveness, and provide a durable buffer against commodity or input cost swings over the medium term.

Conservative leverage and solid equity base

Low reported debt relative to equity and an improving ROE signal financial flexibility for a capital‑intensive industrial operator. Manageable leverage supports funding of large EPC orders, reduces refinancing strain, and preserves ability to pursue contract-backed capex or withstand project payment timing without immediate external capital.

Diversified ETO and EPC business model

Engineered‑to‑order manufacturing, turnkey EPC execution and aftermarket services across multiple end markets create recurring revenue opportunities and steadier order pipelines. This structural diversity reduces dependence on any single cyclical sector and deepens customer relationships, supporting stable demand and aftermarket cash flows.

Negative Factors

Declining free cash flow

A shift to negative free cash flow shows reduced ability to convert earnings into cash, likely from working‑capital tied to projects. This constrains liquidity for capex, debt servicing, and dividends, increases reliance on external funding for growth or bids, and elevates medium‑term execution risk if not corrected.

Low net profit margin

A sub‑4% net margin leaves limited buffer against cost inflation, contract overruns, or pricing pressure. For an engineering and EPC firm, thin net profitability restricts internal funding for expansion, reduces resilience to project delays, and can limit returns to shareholders over the medium term absent margin improvement.

Relatively high total liabilities

While leverage ratios are moderate, high absolute liabilities—including payables, advances and project accruals—can amplify stress from delayed customer payments or contract disputes. Elevated liabilities raise rollover and counterparty risk and can tighten liquidity during prolonged project execution cycles.

ISGEC Heavy Engineering Ltd. Business Overview & Revenue Model

Company Description

Isgec Heavy Engineering Limited operates as a heavy engineering company in India and internationally. It operates in two segments, Manufacturing of Machinery and Equipment; and Engineering, Procurement and Construction. The company offers process equipment, including reactors, pressure vessels, high-pressure shell and tube heat exchangers, and site fabricated columns; boilers, such as solid and biomass fuels, bagasse and biomass, oil and gas fired, blast furnace gas fired, waste to energy, and heat recovery boilers, as well as auxiliaries, such as air pollution control equipment, bag filters, SCR/SNCR, flue gas desulphurization systems, and deaerators; and field services comprising site construction and commissioning, operation and maintenance, supervision, retrofitting and modernization, residual life assessment studies, spares, and technical assistance. It also provides engineering, procurement, and construction services; sugar plants and machinery that include mills, diffusers, process house equipment, sugar refinery, turnkey distillery plants, and spares and retrofits; presses, which comprise mechanical and hydraulic straight sided presses, mechanical gap and ring frame presses, and servo presses; and steel castings, including steam/gas turbine, hydro turbine, valve, pump, mining and crushing, and general engineering castings. In addition, the company offers iron castings, air pollution control equipment, and liquefied gas containers, as well as provides contract manufacturing services. Further, it manufactures and sells sugar and its by-products. The company serves power, fertilizer, sugar and distillery, oil & gas, petrochemicals, automobile components, steel, defense, cement, chemicals, railways, space, and port industries. The company was formerly known as The Saraswati Industrial Syndicate Limited and changed its name to Isgec Heavy Engineering Limited in 2011. Isgec Heavy Engineering Limited was incorporated in 1933 and is headquartered in Noida, India.

How the Company Makes Money

ISGEC Heavy Engineering Ltd. generates revenue primarily through the sale of heavy engineering products, including boilers, pressure vessels, and other industrial equipment. The company's revenue model is built on long-term contracts and project-based engagements, allowing it to secure substantial orders from various industries such as power generation and petrochemicals. Key revenue streams include the manufacturing and supply of customized engineering solutions, maintenance services, and technology licensing. Additionally, ISGEC benefits from strategic partnerships with global firms, enhancing its market reach and capability to undertake large-scale projects, which contribute significantly to its earnings.

ISGEC Heavy Engineering Ltd. Financial Statement Overview

Summary

ISGEC Heavy Engineering Ltd. shows strong revenue growth and improved operational efficiency. The balance sheet is stable with manageable leverage, but high liabilities pose potential risks. Cash flow challenges, particularly in free cash flow, need addressing to enhance liquidity.

Income Statement

ISGEC Heavy Engineering Ltd. showed consistent revenue growth with a notable increase from the previous year. The gross profit margin improved significantly to 21.16%, indicating efficient cost management. Net profit margin remained stable at 3.88%. EBIT and EBITDA margins of 7.43% and 9.63% respectively suggest healthy operational performance. Despite these strengths, the net profit margin is relatively low, indicating room for improvement in profitability.

Balance Sheet

The company's balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.31, indicating manageable leverage. The return on equity (ROE) improved to 9.10%, showcasing effective utilization of shareholders' equity. The equity ratio of 34.04% demonstrates a solid equity base, but the relatively high total liabilities highlight potential financial risks if not managed properly.

Cash Flow

ISGEC experienced a significant decline in free cash flow compared to the previous year, shifting from positive to negative. The operating cash flow to net income ratio decreased substantially, suggesting challenges in converting profits into cash. The free cash flow to net income ratio also turned negative, indicating a need for improved cash management strategies to enhance liquidity.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	62.26B	64.22B	61.67B	63.49B	54.99B	52.46B
Gross Profit	18.71B	13.59B	8.04B	8.34B	14.81B	11.03B
EBITDA	5.78B	6.19B	5.20B	4.63B	3.25B	5.01B
Net Income	2.36B	2.49B	2.44B	1.96B	1.09B	2.48B
Balance Sheet
Total Assets	0.00	80.41B	78.35B	70.75B	67.60B	64.60B
Cash, Cash Equivalents and Short-Term Investments	2.30B	2.30B	1.76B	1.99B	2.30B	1.98B
Total Debt	0.00	8.61B	8.14B	12.35B	12.33B	9.83B
Total Liabilities	-28.49B	51.93B	52.17B	46.83B	45.58B	43.61B
Stockholders Equity	28.49B	27.39B	25.15B	23.04B	21.21B	20.22B
Cash Flow
Free Cash Flow	0.00	-2.21B	4.90B	498.49M	-1.36B	-154.36M
Operating Cash Flow	0.00	193.30M	7.35B	2.08B	-702.99M	2.28B
Investing Cash Flow	0.00	-3.09B	-2.32B	-584.42M	-1.41B	-1.86B
Financing Cash Flow	0.00	2.10B	-4.87B	-977.64M	1.76B	-891.56M

ISGEC Heavy Engineering Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 865.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:ISGEC, the sentiment is Positive. The current price of 865.9 is below the 20-day moving average (MA) of 867.62, above the 50-day MA of 834.30, and below the 200-day MA of 969.19, indicating a neutral trend. The MACD of 19.16 indicates Negative momentum. The RSI at 57.82 is Neutral, neither overbought nor oversold. The STOCH value of 67.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:ISGEC.

ISGEC Heavy Engineering Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SCHAEFFLER	72 Outperform	₹675.79B	52.70	―	0.73%	14.14%	16.91%
SUNDRMFAST	66 Neutral	₹178.53B	37.63	―	0.84%	3.59%	1.37%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
ISGEC	58 Neutral	₹65.57B	24.01	―	0.59%	-4.14%	-35.66%
BHEL	58 Neutral	₹901.51B	64.16	―	0.18%	13.30%	137.07%
LLOYDSENGG	58 Neutral	₹65.90B	33.83	―	0.43%	40.02%	26.77%
THERMAX	58 Neutral	₹376.46B	41.70	―	0.48%	3.37%	-19.95%

ISGEC Heavy Engineering Ltd. Corporate Events

Isgec Clears Results, Renews Leadership and Commits Over Rs 350 Crore to Capacity Expansion

Isgec Heavy Engineering’s board has approved unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025, both carrying unmodified auditor review opinions, underscoring financial reporting stability. The board also cleared a series of senior leadership re-appointments, including the managing director and two joint managing directors, subject to shareholder approval via postal ballot, signaling continuity in strategic management.

In a significant capacity expansion push, the company will invest Rs 22.6 crore in a new machining shop for its iron foundry division and Rs 218 crore to expand its machine building division. It has also raised planned investment in its process skids and modules facility at Dahej SEZ from Rs 87 crore to Rs 110 crore, a move that is expected to enhance manufacturing throughput and deepen its offerings in high-value engineered products.

Isgec Faces Rs 1.71 Lakh GST Penalty, Plans to Appeal Tax Order

Isgec Heavy Engineering Limited has disclosed that the Assistant Commissioner of Central Tax, Bengaluru, has imposed a penalty of Rs. 1,71,116 on the company under the Goods and Services Tax regime, related to taxes that the company states were already paid without any associated interest or penalty. The company has clarified that the financial impact is limited to the penalty amount and has announced its intention to challenge the order by filing an appeal under the Goods and Services Tax Act, signaling that it does not expect any material operational disruption but is actively contesting the tax authority’s position.

Isgec Completes 26% Stake Acquisition in FPEL HR1 Energy

Isgec Heavy Engineering Ltd. has announced the completion of its acquisition of a 26% equity stake in FPEL HR1 Energy Private Limited, following the execution of a Solar Power Purchase Agreement and Shareholder Agreements earlier this year. This move signifies the company’s strategic initiative to diversify into renewable energy, strengthening its stance in the sustainable energy sector and enhancing its value proposition for stakeholders.

ISGEC Cancels Investor Meeting with Quantum Asset Management

ISGEC Heavy Engineering Ltd. announced the cancellation of an investor meeting with Quantum Asset Management Company, which was scheduled for December 15, 2025. The meeting was postponed due to unforeseen circumstances, and a new date will be announced later. This update was made in compliance with regulatory requirements and has been published on the company’s website.