Rico Auto Industries Limited (RICOAUTO) AI Stock Analysis

• Market Cap: ₹14.32B
• Dividend Yield: 0.39%
• Average Volume (3M): 148.19K
• Price to Earnings (P/E): 42.6
• Beta (1Y): 2.04
• Revenue Growth: 3.68%
• EPS Growth: 14.13%
• Country: IN
• Employees: 2,401
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Auto - Parts
• EPS (TTM): 0.80
• Shares Outstanding: 135,284,990
• 10 Day Avg. Volume: 56,320
• 30 Day Avg. Volume: 148,195
• PEG Ratio: -0.88
• Price to Book (P/B): 1.14
• Price to Sales (P/S): 0.38
• P/FCF Ratio: -32.04
• 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: 60 Neutral
• Price Target: ₹111.00 ▼(-18.92% Downside)
• Action: Reiterated Date: 12/27/25
• Date: Action: Reiterated 12/27/25

The score is primarily held back by weaker financial quality (thin and declining margins, higher leverage, and negative free cash flow). This is partially offset by strong technical momentum and trend strength, while valuation is a meaningful headwind due to the high P/E and minimal dividend yield.

Positive Factors

Product and segment diversification

Rico Auto supplies a range of engineered components across passenger vehicles, commercial vehicles and industrial uses. That product and end-market breadth supports steadier demand across vehicle cycles, reduces single-program exposure and improves chances to win multiple OEM programs over months to years.

Value-added tooling and engineering services

Ability to bill tooling, development and engineering creates upfront cash recovery and stronger customer stickiness. These services deepen technical ties with OEMs, raise switching costs, and provide higher-margin, recurring revenue streams that support stable long-term contract economics.

Strong operating cash conversion

The company converts reported earnings into operating cash effectively, indicating underlying operational efficiency and working-capital management. Sustained cash conversion helps fund day-to-day operations and supports program execution even when capex is elevated, aiding medium-term resilience.

Negative Factors

Thin and shrinking profitability

Very low net margins reduce the buffer against input-cost swings and cyclicality common in auto parts. Declining operating margins and recent revenue contraction signal structural margin pressure from cost or pricing dynamics, limiting retained earnings for reinvestment or cushioning downturns.

Elevated financial leverage

Near‑1.0 debt-to-equity increases interest and refinancing risk, constraining balance-sheet flexibility. In a cyclical industry higher leverage amplifies earnings volatility and limits the firm's ability to pursue new programs or absorb downturns without raising costly external capital.

Negative free cash flow (capex > operating cash)

Persistent negative free cash flow means the company must rely on external financing or higher leverage to fund investments and tooling for new programs. Over several months this can strain liquidity, raise financing costs, and limit competitive bidding on OEM contracts that require upfront capital.

Rico Auto Industries Limited Business Overview & Revenue Model

Company Description

Rico Auto Industries Limited, an engineering company, manufactures and supplies high precision fully machined aluminum, and ferrous components and assemblies to automotive original equipment manufacturers worldwide. Its integrated services include the design, development, tooling, casting, machining, assembly, and research and development of aluminum and ferrous products. The company offers oil pump assemblies, fuel system parts, lube oil filter heads, exhaust manifolds, turbine housings, center housings, back plates, crank cases and covers, cylinder head covers, oil pans, intake manifold covers, front covers, valve covers, side covers, balance shafts assemblies, gear housings, and main bearing caps, as well as water, air connections, and pressure plates. It also provides flywheels, timing cases, oil filter adaptors, engine brackets, cylinder blocks, cylinder heads, clutch assemblies, automatic transmission bracket assemblies, differential case housings, gear shifts forks, wheel hubs assemblies, brake panel assemblies, brake discs, drums, and steering knuckles. In addition, the company offers tank track shoe, fuze body, and fuze assembly products, as well as aluminum alloy wheels. It serves two wheeler, three wheeler, passenger car, and commercial vehicle customers, as well as system suppliers. Rico Auto Industries Limited was incorporated in 1983 and is based in Gurugram, India.

How the Company Makes Money

Rico Auto Industries Limited primarily makes money by manufacturing and selling auto components and assemblies to original equipment manufacturers (OEMs) and, to a lesser extent, other customers in the automotive supply chain. Revenue is generated through (1) supply contracts and purchase orders for series-production parts where pricing is typically per-unit and linked to customer production volumes; (2) value-added manufacturing services including casting, machining, and finishing of components (with revenue reflecting conversion value, complexity, and yield); and (3) tooling, development, and engineering-related receipts where customers may pay (fully or partially) for dies/tools and product development required to industrialize a component (when contractually billable). Earnings are influenced by vehicle production cycles, the company’s ability to win new component programs, maintain long-term supply relationships with OEMs/tier suppliers, achieve cost/quality targets, and manage input-cost pass-throughs or pricing adjustments when allowed under customer agreements. Specific customer names, partnership details, and segment-level revenue splits are null.

Rico Auto Industries Limited Financial Statement Overview

Summary

Mixed fundamentals: revenue declined 2.2% in 2025 and profitability is thin (net margin ~0.97%) with declining EBIT margin. Leverage is elevated (debt-to-equity ~0.96) and ROE is low (~2.93%). Cash flow is a key risk with negative free cash flow despite solid operating cash conversion.

Income Statement

Rico Auto Industries Limited has shown consistent revenue growth over the years, but recent performance indicates a decline with a 2.2% drop in revenue for 2025 compared to 2024. Gross profit margins have decreased, and net profit margins are low at 0.97% for 2025, reflecting challenges in cost management and profitability. The EBIT margin has also decreased, indicating pressure on operating income. Despite these challenges, the company has maintained EBITDA margins above 9%.

Balance Sheet

The company has a high debt-to-equity ratio of 0.96 in 2025, indicating substantial leverage which could pose financial risks. The equity ratio stands at 36.5%, suggesting a moderate reliance on equity financing. Return on equity has decreased significantly to 2.93%, highlighting potential inefficiencies in generating returns for shareholders. Overall, the balance sheet reflects moderate stability with concerns about leverage.

Cash Flow

Rico Auto's cash flow situation has weakened, with a negative free cash flow in 2025, indicating that capital expenditures have outpaced operating cash inflow. The operating cash flow to net income ratio remains strong, showing that operational performance can cover net income. However, negative free cash flow suggests challenges in sustaining capital investments without external funding.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	22.68B	22.12B	21.60B	23.02B	18.48B	14.59B
Gross Profit	6.75B	2.14B	2.28B	6.74B	5.20B	4.43B
EBITDA	2.18B	2.00B	2.31B	2.44B	1.76B	985.70M
Net Income	429.70M	214.00M	383.40M	510.10M	237.10M	-141.80M
Balance Sheet
Total Assets	20.47B	20.02B	18.95B	19.36B	17.95B	16.44B
Cash, Cash Equivalents and Short-Term Investments	224.50M	195.40M	208.10M	348.90M	257.30M	174.60M
Total Debt	6.92B	6.97B	6.88B	7.54B	6.13B	5.54B
Total Liabilities	12.90B	12.69B	11.72B	12.46B	11.61B	10.35B
Stockholders Equity	7.54B	7.30B	7.20B	6.89B	6.34B	6.06B
Cash Flow
Free Cash Flow	368.10M	-259.10M	766.60M	-404.30M	124.10M	-1.01B
Operating Cash Flow	1.49B	1.33B	2.47B	1.60B	2.16B	226.80M
Investing Cash Flow	-1.13B	-1.28B	-1.03B	-2.33B	-1.99B	-1.02B
Financing Cash Flow	-409.90M	-32.90M	-1.53B	773.00M	-244.40M	798.10M

Rico Auto Industries Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 136.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:RICOAUTO, the sentiment is Negative. The current price of 136.9 is above the 20-day moving average (MA) of 120.38, above the 50-day MA of 123.59, and above the 200-day MA of 99.39, indicating a neutral trend. The MACD of -4.14 indicates Positive momentum. The RSI at 35.75 is Neutral, neither overbought nor oversold. The STOCH value of 21.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:RICOAUTO.

Rico Auto Industries Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UTTAMSUGAR	64 Neutral	₹7.27B	8.10	―	0.95%	19.83%	46.44%
HUHTAMAKI	64 Neutral	₹12.19B	13.53	―	0.95%	-1.59%	-75.34%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
RICOAUTO	60 Neutral	₹14.32B	42.56	―	0.39%	3.68%	14.13%

Rico Auto Industries Limited Corporate Events

Rico Auto Closes Trading Window Ahead of December Quarter Results

Rico Auto Industries Limited has announced that its trading window for dealing in the company’s securities will be closed from 1 January 2026 until 48 hours after the declaration of its financial results for the quarter and nine months ended 31 December 2025, in compliance with SEBI’s Prohibition of Insider Trading Regulations, 2015. The company will notify the date of the board meeting to approve these results in due course, and during the closure period all promoters, directors, designated persons, connected persons and their immediate relatives are barred from trading in the company’s shares, underscoring its adherence to regulatory norms on insider-trading prevention.