BEML Ltd (BEML)
CyclicalFairStock Score: 53/100 — MIXED
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 0/1
Key Financials
| Current Price | ₹1,874.4 |
| Market Cap | ₹15,611.69 Cr |
| P/E Ratio | 87.71 |
| ROCE | 15.56% |
| ROE | 8.63% |
| Dividend Yield | 0.69% |
| Profit Growth | 57.34% |
| Debt/Equity | 0.11 |
| Sales Growth | 27.95% |
| Free Cash Flow | ₹-22 Cr |
| Promoter Holding | 54.03% |
| 52-Week Range | ₹1,355 — ₹2,275.75 |
| Sector | Agricultural, Commercial & Construction Vehicles |
| Book Value | ₹352.25 |
Strengths
- Debt/Equity of 0.24 indicates a conservative balance sheet
- Promoter holding of 54.03% provides stable ownership
- Altman Z-Score of 2.80 suggests no near-term bankruptcy risk
- ROCE of 15.56% is reasonably above the cost of debt
- Sales growth of 8.38% shows some demand traction
Concerns
- Extreme valuation: P/E 56.21, P/B 5.28, EV/EBITDA 68.67, PEG 34.92
- Latest quarter net loss of ₹22 Cr and negative free cash flow of ₹22 Cr
- Five-year revenue CAGR of only 2.26% with profit growth of –4.84%
- ROE of 8.63% is weak for a business trading at such a high multiple
AI Analysis
I look at BEML and see a cyclical capital goods business wearing an expensive growth label. The five-year revenue CAGR is only 2.26%, and the latest quarter shows sales of ₹1,083 Cr but a net loss of ₹22 Cr, with free cash flow also at –₹22 Cr. That is not compounding. Return on equity is just 8.63%, and ROCE is 15.56% — acceptable, but not the kind of franchise strength I look for. Debt/equity of 0.24 is comfortable, and promoter holding of 54.03% provides a stable government parent, but government ownership is not an economic moat. The Piotroski F-Score of 6/9 suggests the financial position is okay, while the Altman Z-Score of 2.80 puts it in a grey zone. Valuation is the true killer. P/E of 56.21, P/B of 5.28, EV/EBITDA of 68.67, and PEG of 34.92 imply extraordinary growth that the numbers simply do not support. Graham Number works out to ₹482.93; at ₹1,831.75, the margin of safety is –248%. The 8.38% sales growth has not translated into profit growth — in fact, profit is down 4.84%, and the latest quarter is a loss. Dividend yield of 0.63% offers little downside protection. The 52-week range of ₹1,355.00 to ₹2,275.75 shows a moody market. In Buffett terms, this is a cyclical with no clear durable advantage and poor risk-reward at this price. I would wait for a far better margin of safety before considering it.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer