Ellenbarrie Industrial Gases Ltd Q2FY26 – Oxygen Profits, Nitrogen Margins, and a Stock Trading at Himalayan P/E Levels (70.6x)!
1. At a Glance
At ₹437 a share (as of Nov 13, 2025), Ellenbarrie Industrial Gases Ltd sits in the ₹6,167 crore market-cap club — a far cry from its modest eastern roots in Uluberia. The company, once known as the “Oxygen Baba of Bengal,” now sells gases so profitably that investors are gasping (and not just from lack of oxygen). In Q2FY26, revenue stood at ₹89.2 crore — a mild 5.8% QoQ dip — but profit after tax ballooned to ₹36.7 crore, up 23.8% QoQ, thanks to 38% operating margins that even FMCG firms would envy.
ROE is a sizzling 17.8%, ROCE at 18.2%, and debt-to-equity a lean 0.13 — a financial fitness that could make even Linde India take a nervous sip of nitrogen. Yet, with a P/E of 70.6x and EV/EBITDA of 43.4x, the valuation screams premium… or maybe pure helium bubble. The company hasn’t paid a dividend in over a decade, because apparently, free cash flow is reserved for cryogenic tanks, not shareholders.
So what do we have? A gas giant that’s suddenly the toast of Dalal Street, an IPO darling from July 2025, and a company that has learned the art of monetizing thin air — literally.
2. Introduction
Let’s start with a fun fact: Ellenbarrie Industrial Gases Ltd has been around for more than 50 years, manufacturing oxygen and nitrogen in a land where hot air is usually free and plentiful (just watch any election rally). Founded in Kolkata and long overshadowed by global players like Linde and Inox Air Products, Ellenbarrie pulled off a comeback story so clean it could be bottled as medical oxygen.
After its ₹852 crore IPO in July 2025, the company suddenly went from a sleepy regional supplier to a full-blown listed celebrity in the industrial gas galaxy. Its market cap shot past ₹6,000 crore faster than nitrogen expands at room temperature.
The twist? Despite all that expansion talk — 3,691 TPD installed capacity and another 390 TPD under construction — the company’s actual quarterly sales (₹89 crore) would barely buy two weeks of oxygen for a big steel plant. So yes, it’s efficient, but the market’s love affair seems based more on hope than helium.
Still, you can’t ignore results like these: 35.2% operating margins, ₹36.7 crore quarterly profit, and 91% YoY profit growth in FY25. The company’s oxygen cylinders might be heavy, but its earnings are weightless — pure float.
3. Business Model – WTF Do They Even Do?
In simplest terms: they sell air. But this air comes in shiny steel cylinders, cryogenic tankers, and billion-rupee ASU plants that turn the atmosphere into money.
Ellenbarrie manufactures industrial and medical gases — oxygen (48% of revenue), nitrogen (37%), and argon (9%) form its holy trinity. Add to that some helium, acetylene, hydrogen, carbon dioxide, and nitrous oxide (the laughing gas — perhaps the one analysts use when valuing it at 70x P/E).
Their business operates under two major heads:
Industrial & Medical Gases (84% of FY24 Revenue) — Supplied in three ways:
Bulk: via cryogenic tankers for large industries like steel and pharma.
Packaged: in cylinders for dealers, hospitals, and small users.
Onsite: pipeline-linked gas plants set up right at customer premises.
Project Engineering Services (16%) — Designs and builds oxygen plants, PSA systems, hospital gas setups, and other engineering projects.
Client base? Around 1,836 customers across pharma, steel, healthcare, defense, and railways — with a juicy 92% repeat business rate. In other words, their customers are addicted to oxygen, and Ellenbarrie is their dealer.
4. Financials Overview
Quarterly Snapshot – Figures in ₹ Crores
Metric
Q2FY26 (Sep 2025)
Q2FY25 (Sep 2024)
Q1FY26 (Jun 2025)
YoY %
QoQ %
Revenue
89.2
95.0
84.0
-6.1%
6.2%
EBITDA
33.9
36.0
31.0
-5.8%
9.4%
PAT
36.7
30.0
29.6
22.3%
23.8%
EPS (₹)
2.61
2.26
1.33
15.5%
96.2%
(Annualised EPS = ₹10.44; P/E ≈ 41.8x on annualised)
The story is simple: stable revenue, margin improvement, and a surge in net profit — mostly aided by high-margin gas contracts and “other income” of ₹13 crore. Because when oxygen prices are fixed, you make money by breathing in “other income.”
Operating margins at 38% and PAT margins at 41% are astronomical for a manufacturing business — almost as if they’ve found a way to package oxygen infused with gold dust.
5. Valuation Discussion – Fair Value Range (for educational purposes only)
Let’s talk numbers before someone faints from valuation shock.
Method 1: P/E-based Approach
EPS (TTM): ₹6.36
Industry P/E: 55.0
Company P/E: 70.6
➡️ Fair Value Range = ₹6.36 × (55–65) = ₹350 – ₹414 per share
Method 2: EV/EBITDA
EV = ₹6,160 crore
EBITDA (FY25) = ₹110 crore
EV/EBITDA = 43.4x (vs peer avg ~25x) ➡️ At a sector multiple of 25x → EV = 25 × 110 = ₹2,750 crore → Equity Value ≈ ₹2,631 crore → ₹186 per share
Method 3: DCF (10% discount, 12% growth next 5 years) Discounted range yields ₹380–₹460 per share.
📘 Fair Value Range (Educational Only): ₹350 – ₹460
Disclaimer: This fair value range is for educational purposes only and not investment advice. Please breathe normally.
6. What’s Cooking – News, Triggers, Drama
This fiscal, Ellenbarrie has been busier than a hospital oxygen ward during COVID. A few highlights:
IPO Mania (July 2025): Raised ₹852 crore — ₹400 crore fresh issue for debt repayment, expansion, and general purposes. Listed with a pop that would make oxygen molecules jealous.
Acquisition Alert: Acquired Truair Industrial Gases for ₹5.40 crore in August 2025. Small deal, but symbolic — Ellenbarrie is inhaling smaller players to expand footprint.
