1. At a Glance – The Magnet That’s Pulling Valuation More Than Profits
Ladies and gentlemen, welcome to the curious case of a company that literally makes magnets… but somehow manages to attract a 45x P/E valuation with declining profits. Permanent Magnets Ltd looks like that quiet topper in class—until you check the report card and realize the marks are slipping while confidence is skyrocketing.
Revenue? Flat.
Profit? Down.
Margins? Volatile.
Stock price? Still behaving like it’s building the next Tesla motor.
And here’s the twist: while the company is talking about EVs, rare earth magnets, and government incentives like a Bollywood trailer screaming “blockbuster”, the actual numbers are whispering “mid-budget drama”.
Add to this:
- Heavy dependence on energy meters (37%)
- Export disruptions from the U.S.
- Working capital cycle that looks like a marathon runner who forgot the finish line
- And a future that depends heavily on projects still under testing or approvals
So the real question is:
Is this a hidden EV supply chain gem… or just a well-marketed industrial component company?
Let’s dissect this magnet piece by piece.
2. Introduction – From Alnico Magnets to Ambitions of Rare Earth Dominance
Permanent Magnets Ltd (PML), founded in 1960, is not your typical flashy startup. It’s more like that old family-owned business that has quietly survived through wars, recessions, and probably several tax raids (just kidding… hopefully).
Owned by the Taparia Group, PML operates in:
- Current sensing (shunts, sensors)
- Magnetic assemblies
- Meter components
- Alloys and specialized materials
It supplies to industries like:
- Energy meters
- Automotive / EV
- Aerospace and defense
- Electronics
Sounds impressive, right?
But here’s the catch—this is a low glamour, high engineering business. You don’t see viral Instagram reels about current sensing modules.
Now, suddenly:
- EV boom
- Smart meters push
- China+1 narrative
- Government incentives
And boom… PML is pitching itself like it’s Nvidia of magnets.
But reality check:
- Sales are just ₹205 Cr
- PAT is ₹13.4 Cr
So the big question is:
Are we early… or just overexcited?
3. Business Model – WTF Do They Even Do?
Let’s simplify this like explaining to your cousin who only understands business through Shark Tank.
PML essentially does this:
Step 1: Makes Magnetic Stuff
- Magnets
- Magnetic assemblies
- Components for electricity meters
Step 2: Makes Current Measuring Devices
- Shunts
- Sensors
- Modules used in EVs and meters
Step 3: Supplies to OEMs
They don’t sell directly to consumers. They sell to companies making:
- Electric vehicles
- Smart meters
- Industrial machines
Step 4: Customization Game
This is not FMCG. Every product is:
- Customized
- Specification-heavy
- Long approval cycles
Which means:
- Sticky clients
- Slow scaling
Now add this spice:
- JV for rare earth magnets
- Entry into relay manufacturing
- Expansion in alloy capacity
Basically, PML is trying to move:
From commodity supplier → high-value integrated solution provider
But here’s the catch:
- Execution takes time
- Approvals take forever
- Customers move slower than Indian bureaucracy
So ask yourself:
Is this transformation real… or just
