KSB (KSB)
StalwartFairStock Score: 28/100 — RISKY
Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹801.25 |
| Market Cap | ₹13,944.89 Cr |
| P/E Ratio | 56.83 |
| ROCE | 24.52% |
| ROE | 15.19% |
| Dividend Yield | 0.55% |
| Profit Growth | -18.02% |
| Debt/Equity | 0 |
| Sales Growth | 2.63% |
| Free Cash Flow | ₹143 Cr |
| Promoter Holding | 69.8% |
| 52-Week Range | ₹666.65 — ₹1,028.3 |
| Sector | Industrial Products |
| Book Value | ₹97.64 |
Strengths
- Zero debt with strong capital efficiency: D/E 0.00, ROE 16.11%, ROCE 24.52%.
- High promoter holding of 69.80% aligns ownership with minority shareholders.
- Piotroski F-Score of 8/9 and Altman Z-Score of 4.88 indicate sound financial health.
- Positive free cash flow of ₹143 Cr and latest quarter profit of ₹81 Cr on ₹784 Cr sales.
- Five-year revenue CAGR of 12.49% reflects a steady compounding franchise.
Concerns
- Valuation is far too high: P/E 46.40, P/B 10.14, PEG 6.75 against modest growth.
- DCF intrinsic value of ₹437.72 and Graham Number of ₹183.77 are well below the market price of ₹977.65.
- Negative margin of safety of -319.14% leaves no room for error.
- EV/EBITDA of -33.38 is unusual and needs a clear explanation.
AI Analysis
First, this is an excellent business. KSB operates in pumps and compressors with zero debt, a promoter holding of 69.80%, an ROE of 16.11%, and an ROCE of 24.52%. The Piotroski F-Score of 8/9 and Altman Z-Score of 4.88 reinforce my faith in the balance sheet. In the latest quarter, the company earned ₹81 crore on ₹784 crore of sales, roughly a 10% net margin, and it generated ₹143 crore of free cash flow. Over five years, revenue compounded at 12.49%. These are the numbers of a durable, well-managed franchise. But I do not buy good businesses at any price. At ₹977.65, I am being asked to pay 46.40 times earnings and 10.14 times book value. My Graham Number is only ₹183.77, and a DCF estimate lands at ₹437.72. The stated margin of safety is -319.14%. Meanwhile, recent sales growth is just 6.42% and profit growth is only 9.29%; the PEG of 6.75 makes the valuation look very demanding. The dividend yield of 0.52% offers no support, and the stock sits near its 52-week high of ₹1,028.30. Even the negative EV/EBITDA of -33.38 is a puzzle that I would want explained before committing money. This is a wonderful business, but at this price it fails Graham's first test: there is no margin of safety. I would put KSB on my watchlist, wait patiently, and only invest when Mr. Market offers a price closer to intrinsic value.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer