Veto Switchgears & Cables Ltd. (VETO) AI Stock Analysis

• Market Cap: ₹1.90B
• Dividend Yield: 0.86%
• Average Volume (3M): 4.48K
• Price to Earnings (P/E): 9.0
• Beta (1Y): 0.91
• Revenue Growth: 7.26%
• EPS Growth: 19.13%
• Country: IN
• Employees: 331
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 3.17
• Shares Outstanding: 19,114,956
• 10 Day Avg. Volume: 2,610
• 30 Day Avg. Volume: 4,480
• PEG Ratio: 0.43
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.74
• P/FCF Ratio: -35.83
• 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: 70 Outperform
• Price Target: ₹110.00 ▼(-2.05% Downside)

Veto Switchgears & Cables Ltd. has a solid financial foundation with consistent revenue growth and a strong equity position. However, challenges in operational margins and cash flow need addressing. The stock's valuation is attractive, providing a potential opportunity for investors. Technical indicators suggest stability but lack a strong trend.

Positive Factors

Conservative capital structure

Very low leverage and an 80% equity ratio provide durable financial flexibility. This conservatism supports resilience through demand cycles, gives headroom for strategic investments or acquisitions, and reduces refinancing risk—strengths that matter over 2–6 months and beyond.

Consistent top-line growth

Steady revenue expansion indicates persistent demand for the company’s switchgear and cable products and supports scale advantages. Durable revenue growth helps underpin margin recovery efforts and funds reinvestment, aiding medium-term competitiveness and planning.

Improving return on equity and net margin

Rising ROE and a higher net margin show the company has improved profit conversion and shareholder returns. These durable profitability gains suggest better cost control or pricing power, enhancing the ability to sustain investment and reward equity holders over the medium term.

Negative Factors

Negative free cash flow in 2025

A shift to negative free cash flow weakens the firm's internal funding capacity, forcing reliance on external financing for capex or working capital. This can constrain strategic initiatives and increases liquidity risk if the trend persists over several quarters.

Sharp EBIT margin compression

A large drop in EBIT margin erodes operating leverage and indicates rising costs or pricing pressure. Sustained margin compression would reduce free cash generation and competitiveness, requiring structural cost or product-mix fixes to restore durable profitability.

Weaker cash conversion and liquidity metrics

Declining cash conversion relative to reported earnings signals weaker earnings quality and tighter liquidity. Over 2–6 months this can limit the firm’s ability to fund working capital, raise investment, or pay dividends without external support, raising financial flexibility concerns.

Veto Switchgears & Cables Ltd. Business Overview & Revenue Model

Company Description

Veto Switchgears and Cables Limited, together with its subsidiaries, manufactures and sells wires and cables, and electrical accessories in India and internationally. The company operates through Wire and Cables, Lighting & Fittings, and Accessories & Others segments. It provides electrical accessories, including vyoma, carino, and power modular switches, as well as PUF and ZAC switches; and MCBs/isolators/distribution boxes, and bells and extension cords. The company also offers wires and cables, such as multi strand, L.T. industrial, and copper flexible cables; ceiling, ventilation, and fresh air fans, as well as submersible pumps; and LED panels, street lights, flood lights, concealed lights, deep lights, bulbs, and tubelights, as well as surface and spot lights, wall and track lights, and strip lights and lighting chains. In addition, it provides telephone and co-axial wires, compact fluorescent lamps, slim panel lights, immersion heaters, distribution boards, and other electrical accessories, such as switch socket, MCB, bell, and all other electrical accessories. The company markets its products under the VETO and VIMAL POWER brand names through a network of dealers and distributors. Veto Switchgears and Cables Limited was founded in 1967 and is based in Jaipur, India.

How the Company Makes Money

Veto Switchgears & Cables Ltd. generates revenue through multiple streams primarily focused on the sale of its electrical products. The company's main revenue model revolves around the direct sale of switchgears, cables, and related electrical equipment to contractors, industrial clients, and government projects. Additionally, VETO engages in large-scale contracts and tenders, which provide significant revenue influx from infrastructure and energy projects. The company also benefits from strategic partnerships with other manufacturers and suppliers, enhancing its distribution capabilities and expanding its market reach. Furthermore, VETO may generate income from after-sales services, including installation, maintenance, and technical support, which creates long-term relationships with clients and ensures a steady flow of revenue.

Veto Switchgears & Cables Ltd. Financial Statement Overview

Summary

Veto Switchgears & Cables Ltd. shows consistent revenue growth and a strong equity position. However, recent declines in operational margins and negative cash flow highlight the need for strategic improvements in cost management and liquidity.

Income Statement

Veto Switchgears & Cables Ltd. has shown consistent revenue growth over the years with a slight decline in gross profit margin recently. The net profit margin improved to 7.4% in 2025 from 6.0% in 2024, reflecting better cost management. EBIT margin is strong, though it decreased from 17.7% in 2024 to 9.5% in 2025, indicating a need to control operational expenses.

Balance Sheet

The company's balance sheet reflects solid equity with a healthy equity ratio of 80.2% in 2025. The debt-to-equity ratio is low at 0.09, suggesting conservative leverage. Return on equity increased to 8.3% in 2025, highlighting effective use of shareholder funds, though there's room for improvement in asset utilization.

Cash Flow

Cash flow remains a concern, with free cash flow turning negative in 2025. The operating cash flow to net income ratio has decreased, indicating potential liquidity management issues. However, previous years' positive free cash flow shows the potential for recovery.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.04B	3.00B	3.00B	2.91B	2.68B	1.82B
Gross Profit	770.85M	593.77M	752.96M	765.38M	697.76M	341.50M
EBITDA	331.95M	342.37M	353.75M	377.59M	368.07M	248.24M
Net Income	208.82M	221.32M	179.52M	202.47M	200.17M	147.94M
Balance Sheet
Total Assets	0.00	3.32B	3.06B	3.21B	3.09B	2.74B
Cash, Cash Equivalents and Short-Term Investments	14.47M	14.47M	79.37M	152.49M	94.50M	125.89M
Total Debt	0.00	229.48M	225.60M	433.88M	469.33M	356.23M
Total Liabilities	-2.67B	648.05M	589.37M	874.93M	953.01M	794.67M
Stockholders Equity	2.67B	2.66B	2.46B	2.33B	2.13B	1.94B
Cash Flow
Free Cash Flow	0.00	-62.14M	206.48M	128.89M	-97.01M	42.28M
Operating Cash Flow	0.00	135.38M	269.47M	179.72M	-84.31M	74.03M
Investing Cash Flow	0.00	-184.88M	-56.73M	-41.50M	-1.89M	-73.85M
Financing Cash Flow	0.00	-15.48M	-273.13M	-98.86M	43.15M	-16.19M

Veto Switchgears & Cables Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 112.30
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:VETO, the sentiment is Negative. The current price of 112.3 is above the 20-day moving average (MA) of 103.84, above the 50-day MA of 108.46, and below the 200-day MA of 115.58, indicating a bearish trend. The MACD of -3.26 indicates Positive momentum. The RSI at 36.86 is Neutral, neither overbought nor oversold. The STOCH value of 27.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:VETO.

Veto Switchgears & Cables Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VETO	70 Outperform	₹1.90B	9.02	―	0.86%	7.26%	19.13%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SALZERELEC	61 Neutral	₹9.99B	17.93	―	0.36%	21.51%	-17.75%
HPL	60 Neutral	₹21.33B	22.24	―	0.24%	6.08%	49.44%
HIRECT	58 Neutral	₹21.52B	45.26	―	0.13%	35.05%	99.65%
SUNDRMBRAK	55 Neutral	₹2.29B	-153.22	―	0.22%	4.26%	-121.56%
KECL	49 Neutral	₹5.56B	75.63	―	―	-11.25%	-48.96%