Varroc Engineering Limited (IN:VARROC)
:VARROC
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Varroc Engineering Limited
(VARROC)
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Rating:63Neutral
Price Target:
₹626.00
▲(2.48% Upside)
Action:Reiterated
Date:05/28/26
The score is driven primarily by improving fundamentals (revenue growth, profitability recovery, and a much stronger leverage profile), offset by weak FY2026 free-cash-flow conversion and uneven margins. Technically, the stock shows a strong uptrend and positive momentum, but valuation support is limited due to a negative P/E and a very low dividend yield.
Positive Factors
Program-based OEM revenue model
Varroc's core B2B, program-based model creates multi-year, recurring serial production revenue tied to vehicle platforms. Durable OEM program revenue gives predictable volume windows, supports long production runs, and rewards design wins with sustained cashflow and capacity utilization advantages.
Negative Factors
Free cash flow collapse
A ~77.6% drop in FCF to ~0.33B in FY2026 materially reduces internal funding capacity. Even with positive operating cash flow, weak FCF constrains capital allocation, limits ability to fund new program investment or repay debt, and raises reliance on external financing for growth or cyclical stress.
Read all positive and negative factors
Positive Factors
Negative Factors
Program-based OEM revenue model
Varroc's core B2B, program-based model creates multi-year, recurring serial production revenue tied to vehicle platforms. Durable OEM program revenue gives predictable volume windows, supports long production runs, and rewards design wins with sustained cashflow and capacity utilization advantages.
Read all positive factors
Varroc Engineering Limited (VARROC) vs. iShares MSCI India ETF (INDA)
Market Cap
₹89.83B
Dividend Yield0.16%
Average Volume (3M)13.17K
Price to Earnings (P/E)38.4
Beta (1Y)1.39
Revenue Growth9.03%
EPS Growth267.59%
CountryIN
Employees3,907
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Parts
Share Statistics
EPS (TTM)9.12
Shares Outstanding152,786,400
10 Day Avg. Volume5,337
30 Day Avg. Volume13,169
Financial Highlights & Ratios
PEG Ratio0.12
Price to Book (P/B)4.01
Price to Sales (P/S)0.80
P/FCF Ratio213.63
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)26.27
Revenue Forecast (FY)₹98.44B
Varroc Engineering Limited Business Overview & Revenue Model
Company Description
Varroc Engineering Limited designs, manufactures, and supplies exterior lighting systems, plastic and polymer components, electrical and electronics components, and precision metallic components worldwide. It operates through Automotive and Others...
How the Company Makes Money
Varroc Engineering makes money primarily by manufacturing and selling automotive components and systems to original equipment manufacturers (OEMs). Its revenue model is business-to-business and program-based: components are awarded through OEM sou...
Varroc Engineering Limited Financial Statement Overview
Summary
Income Statement
63
Positive
Balance Sheet
72
Positive
Cash Flow
55
Neutral
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 84.09B | 88.90B | 81.54B | 75.52B | 68.91B | 58.44B |
| Gross Profit | 29.19B | 18.94B | 28.33B | 27.15B | 23.68B | 19.20B |
| EBITDA | 7.65B | 5.05B | 7.26B | 7.02B | 5.42B | 6.83B |
| Net Income | 1.39B | 2.25B | 612.30M | 5.26B | -8.20B | -11.10B |
Balance Sheet | ||||||
| Total Assets | 47.73B | 48.75B | 46.72B | 45.60B | 46.21B | 109.98B |
| Cash, Cash Equivalents and Short-Term Investments | 3.60B | 2.42B | 2.01B | 2.27B | 3.57B | 1.18B |
| Total Debt | 9.15B | 7.16B | 11.18B | 13.90B | 18.06B | 16.25B |
| Total Liabilities | 30.51B | 30.34B | 30.74B | 30.34B | 36.17B | 89.84B |
| Stockholders Equity | 16.84B | 17.80B | 15.65B | 14.97B | 9.76B | 19.89B |
Cash Flow | ||||||
| Free Cash Flow | 1.49B | 334.25M | 4.48B | 3.64B | 880.13M | -2.18B |
| Operating Cash Flow | 3.66B | 4.31B | 7.37B | 6.38B | 6.86B | 6.36B |
| Investing Cash Flow | -247.66M | -1.35B | -2.46B | -1.66B | -2.86B | -7.63B |
| Financing Cash Flow | -3.36B | -2.88B | -4.90B | -6.64B | -2.16B | -3.35B |
Varroc Engineering Limited Technical Analysis
Positive
610.85
Price Trends
525.07
Positive
543.22
Positive
575.64
Positive
Market Momentum
13.76
Negative
63.96
Neutral
80.10
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:VARROC, the sentiment is Positive. The current price of 610.85 is above the 20-day moving average (MA) of 557.09, above the 50-day MA of 525.07, and above the 200-day MA of 575.64, indicating a bullish trend. The MACD of 13.76 indicates Negative momentum. The RSI at 63.96 is Neutral, neither overbought nor oversold. The STOCH value of 80.10 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:VARROC.
Varroc Engineering Limited Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | ₹1.06T | 38.95 | ― | 1.42% | 10.77% | 37.61% | |
66 Neutral | ₹113.67B | 47.19 | ― | 0.35% | 40.63% | 52.28% | |
66 Neutral | ₹1.50T | 39.81 | ― | 0.47% | 10.95% | -11.38% | |
63 Neutral | ₹89.83B | 38.36 | ― | 0.16% | 9.03% | 267.59% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | ₹263.41B | 41.71 | ― | 1.24% | 23.15% | -17.54% | |
58 Neutral | ₹652.87B | 53.07 | ― | 0.17% | 17.19% | 26.50% |
* Consumer Cyclical Sector Average
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Varroc Engineering Limited Corporate Events
Varroc Engineering Closes Trading Window Ahead of FY26 Results
Mar 17, 2026
Varroc Engineering Limited has announced the closure of its trading window for designated persons and their relatives, in line with SEBI’s Prohibition of Insider Trading Regulations and the company’s internal code of conduct. The restr...
Varroc Gains New Voluntary ESG Rating From SEBI-Registered Provider
Mar 9, 2026
Varroc Engineering Limited disclosed that SEBI-registered ESG rating provider CFC Finlease has voluntarily assigned the company an ESG score of 75, based solely on publicly available information. This new assessment follows earlier ESG ratings fro...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.