LMW Ltd Q3 FY26 — ₹3,300 Cr Order Book, 127x P/E, 4% ROCE: Precision Engineering or Precision Overvaluation?

1. At a Glance – Blink and You’ll Miss the Profit

Lakshmi Machine Works (LMW) is that one Coimbatore uncle who owns prime real estate, eats home-cooked food, has zero loans, but still refuses to make money fast. Market cap of ~₹15,400 Cr, stock chilling around ₹14,400, P/E doing Olympic-level gymnastics at 127x, while ROCE is sitting quietly at 4.5%, wondering what it did wrong in life.

Q3 FY26 numbers? Revenue of ~₹758 Cr (down YoY by ~1%), PAT of ~₹20 Cr (up ~5% YoY), and operating margins hovering at a sleepy ~5%. The company is debt-free, cash-rich, and operationally disciplined — but growth? That’s currently stuck in traffic near Avinashi Road.

And yet… a ₹3,300 Cr order book, aerospace dreams, CNC ambitions, and textile cycles whispering “next upcycle”. Is LMW a coiled spring — or just a very expensive museum of engineering excellence?

Curious? You should be.

2. Introduction – The Most Boring Company With the Most Confusing Valuation

LMW is not flashy. No buzzwords like “AI-first”, no influencer CEO on LinkedIn, no midnight crypto pivots. Just machines. Heavy, oily, extremely precise machines.

Founded decades ago, LMW built its reputation as India’s go-to spinning machinery supplier. If India exports yarn, chances are LMW machines were sweating in the background. Over time, the company quietly diversified into CNC machine tools, precision castings, and now — aerospace components.

But here’s the twist:
Despite stable revenues (~₹3,000 Cr+), pristine balance sheet, and strong brand recall, profitability has collapsed from peak-cycle highs. FY23–FY25 margins compressed, ROCE halved, and earnings volatility returned like an unwanted sequel.

Yet the market is still pricing LMW like it’s a luxury Swiss watchmaker. Why? Because cycles, optionality, and legacy respect — the holy trinity of Indian capital goods investing.

But does respect pay dividends? Let’s dig.