🧠 At a Glance
Shivalik Bimetal Controls Ltd is no ordinary metal company — they don’t make steel bars, they engineer the brains of modern electronics. From electric vehicles to smart meters, if current needs to be measured, Shivalik’s shunt resistors and bimetal strips are probably in there. With a CAGR of 42% in profit over 5 years, a joint venture with Metalor, and ROCE of 26%, this ₹3,000 Cr microcap punches way above its weight. But is the recent FII frenzy justified, or is the market pricing in too much optimism?
1️⃣ Hook: “Not All Metals Are Dumb”
Shivalik isn’t mining or smelting — it’s precision-engineering:
- Electron beam welded bimetal strips ⚡
- Shunt resistors for EVs, meters, and switchgear
- Client base spans North America, Europe, and Asia
- Clean balance sheet, high margins, and MoUs with global tech players like Metalor
Basically: if you use electricity, you’ve probably used Shivalik. Indirectly.
2️⃣ WTF Do They Even Do?
Business Model:
- 🎯 Core: Manufacturing & sale of:
- Thermostatic bimetal/trimetal strips
- Shunt resistors & current sense metal strips
- Electron beam welded products
- 👨🔬 Tech Edge:
- Electron beam welding
- Continuous brazing
- Resistance bonding
- 💡 End-Use Industries:
- Automotive (especially EVs 🚗⚡)
- Electrical switchgear & circuit protection
- Energy meters & smart meters
- Consumer durables & industrial electronics
3️⃣ Financials – Consistency Is Sexy
| FY | Sales (₹ Cr) | Net Profit (₹ Cr) | EPS | ROCE | ROE |
|---|---|---|---|---|---|
| FY21 | 204 | 25 | 4.43 | 23% | 17% |
| FY22 | 324 | 55 | 9.57 | 36% | 24% |
| FY23 | 470 | 79 | 13.73 | 38% | 26% |
| FY24 | 509 | 84 | 14.63 | 33% | 23% |
| FY25 | 508 | 77 | 13.38 | 26% | 21% |
📈 5-Year Profit CAGR: 42%
📈 5-Year Sales CAGR: 22%
Even as OPMs cooled slightly from 23% → 20%, profitability remains robust.
4️⃣ Valuation – Is It Crack?
| Metric | Value |
|---|---|
| CMP | ₹535 |
| P/E | 40x |
| Book Value | ₹70.4 |
| P/B | 7.6x |
| Market Cap | ₹3,082 Cr |
Valuation feels premium for a microcap. But:
- 🧮 If FY26 EPS = ₹16 → P/E forward = 33x
- Assuming 18–22x fair PE range:
🧠 Fair Value Range: ₹290–₹355
This implies it’s richly priced, possibly baking in future MoU/JV wins.
5️⃣ What’s Cooking – News, Triggers, Drama
- 🧾 Metalor JV (Switzerland) signed in Nov 2023
- 🧠 MoU signed for future tech collaboration in specialty alloys
- 🏗️ Bought industrial land in HP for ₹6.5 Cr (Apr 2024)
- 🚨 Management reshuffle: Chairman SS Sandhu resigned in 2024
- 🔥 FIIs + DIIs now own 25% — up from <2% just 2 years ago
The market is betting on Shivalik 2.0 — powered by exports and JV tech infusion.
6️⃣ Balance Sheet – Clean and Muscular
| FY | Net Worth (₹ Cr) | Debt (₹ Cr) | Cash Flow from Ops |
|---|---|---|---|
| FY21 | 140 | ₹29 Cr | ₹30 Cr |
| FY23 | ₹330 Cr | ₹42 Cr | ₹69 Cr |
| FY25 | ₹394 Cr | ₹33 Cr | ₹94 Cr |
- ✅ Almost debt-free
- ✅ Increasing capex via internal accruals
- 🏭 CWIP now ₹24 Cr (industrial land + capacity expansion likely)
7️⃣ Cash Flow – Sab Number Game Hai
| FY | CFO | Capex (CFI) | FCF |
|---|---|---|---|
| FY23 | ₹69 Cr | ₹18 Cr | ₹51 Cr |
| FY25 | ₹94 Cr | ₹58 Cr | ₹36 Cr (est) |
They’re investing again after a breather — possibly linked to the JV with Metalor and ramping up export orders.
8️⃣ Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROCE | 25.9% |
| ROE | 20.6% |
| OPM | 20% |
| Debtor Days | 80 |
| Inventory Days | 166 |
| Working Capital Cycle | 197 days |
📉 Slight drop in efficiency, but still elite territory for industrials.
9️⃣ P&L Breakdown – Quarterly View
| Quarter | Sales (₹ Cr) | PAT (₹ Cr) | OPM | EPS |
|---|---|---|---|---|
| Mar 2024 | ₹128 | ₹26 | 17% | ₹4.46 |
| Jun 2024 | ₹126 | ₹18 | 19% | ₹3.09 |
| Sep 2024 | ₹127 | ₹20 | 21% | ₹3.46 |
| Dec 2024 | ₹123 | ₹18 | 20% | ₹3.17 |
| Mar 2025 | ₹132 | ₹21 | 22% | ₹3.65 |
Steady numbers with healthy margins — not flashy, but boringly reliable.
🔟 Peer Comparison – Can It Punch Up?
| Company | P/E | ROE | OPM | Mcap |
|---|---|---|---|---|
| Shivalik Bimetal | 40x | 20.6% | 20% | ₹3,082 Cr |
| Ratnamani | 37x | 16% | 15.8% | ₹20,000 Cr |
| Welspun Corp | 16x | 23% | 11.9% | ₹24,500 Cr |
| APL Apollo | 63x | 19% | 5.8% | ₹47,600 Cr |
Shivalik’s valuation is Ratnamani-tier, but size and scalability still lag. That’s where the JV narrative kicks in.
1️⃣1️⃣ Shareholding – Who’s In, Who’s Out
- 📉 Promoters reduced stake from 60.6% → 33.18% (dilution or planned exit?)
- 📈 DIIs now own 21% (massive jump from <1%)
- 📈 FIIs hold 3.6%
- 🧑🤝🧑 Public shareholding steady at 42%
Looks like institutional takeover in progress, or big bets on future scale.
1️⃣2️⃣ EduInvesting Verdict™
Shivalik is a rare industrials microcap that has grown cleanly, partnered smartly, and maintained financial discipline. But:
✅ Fundamentals: Rock solid
✅ Tech & Moats: Real
✅ Exports: Strong contributor
⚠️ Concerns:
- High valuation (P/E 40x)
- Working capital-heavy model
- Promoter stake fall → Red flag or planned?
💸 Fair Value Range: ₹290–₹355
(based on 18–22x forward EPS of ₹16)
🎤 Would we bet against a firm that welds metal atoms for a living? Nope. But would we pay 40x for it? Not without an espresso shot and a JV earnings estimate.
✍️ Written by Prashant | 📅 July 6, 2025
Tags: Shivalik Bimetal, Metalor JV, Shunt Resistors, EV Components, Bimetal Strips, Smallcap Engineering Stocks, Precision Manufacturing India, ROCE Kings, EduInvesting
