1. At a Glance
   Over the past five years, Lloyds Engineering Works Ltd has transitioned from basic steel fabrication to turnkey EPC solutions for refineries, power stations and naval vessels. FY25 revenue rose 21% to ₹755.8 Cr, EBITDA margin expanded to 19.2%, and order book jumped to ₹1,315 Cr. Net debt/EBITDA sits at 0.6×. Fair value: ₹14–18.
2. Introduction with Hook
   Picture this: welding massive stabilizer fins for a missile vessel in the morning, then overseeing a nuclear boiler assembly by afternoon. That’s a day in the life of Lloyds Engineering—a once-niche fabricator now elbowing into high-precision, high-margin infrastructure projects. But such reinvention comes with growing pains, valuation questions and a rights issue that could make or break the next leg of growth.
3. Business Model (WTF Do They Even Do?)

• Design & Manufacturing: Heavy equipment and pressure vessels for oil & gas, steel, power and nuclear sectors.
• Engineering & Commissioning: End-to-end EPC (Engineering, Procurement, Construction) contracts—think marine stabilizers, nuclear boilers, refinery skids.
• Aftermarket & Maintenance: Spare parts, service contracts and retrofits provide recurring revenues.
• Acquisitions & Partnerships: Strategic stakes in complementary firms (e.g., Techno Industries) to broaden capabilities.

4. Financials Overview – Profit, Margins, ROE, Growth

• FY25 Revenue: ₹755.8 Cr (+21% YoY)
• EBITDA: ₹145.2 Cr (+34% YoY) | EBITDA Margin: 19.2% vs 17.0% in FY24
• PAT: ₹105.0 Cr vs ₹98.5 Cr last year | PAT Margin: 13.9%
• ROE: ~18.5% (PAT/Equity of ₹531 Cr)
• 5-Year Revenue CAGR: ~15%

5. Valuation – Is It Cheap, Meh, or Crack?

• CMP: ₹81.4 | P/E: ~110× FY25 | P/B: ~18.5× BV of ₹4.4
• Peer Median: P/E ~70×, P/B ~6×
• Fair Value Range:
  • Based on 15–20× FY25E EPS (~₹0.9): ₹13.5–18
  • Based on 4–5× BV: ₹17.6–22
  • Blended Range: ₹14–18
• Verdict: Priced for perfection; room for upside only if execution and order wins accelerate materially.

6. What’s Cooking – News, Triggers, Drama

• 1 Jul ’25: Increased stake in Techno Industries to 88% for ₹25 Cr—adds precision fabrication and cross-sell synergies.
• 5 Jun ’25: Rights issue of ₹1,050 Cr at ₹32 announced—record date set, raising funds for capex, working capital and acquisitions.
• 19 May ’25: ₹15.4 Cr order to build Mumbai’s Cricket Museum fit-out at Wankhede Stadium.
• 22 May ’25: ₹20.7 Cr naval stabilizer order for missile vessels—repeat business with defense PSU.
• Boardroom: ESOP grants approved; two new independent directors added, bolstering governance.

7. Balance Sheet – How Much Debt, How Many Dreams?

• Net debt/EBITDA ~0.6×—conservative leverage given growth capex and acquisitions.

8. Cash Flow – Sab Number Game Hai

• Operating CF: +₹158 Cr
• Investing CF: –₹109 Cr (capex + Techno Industries acquisition)
• Financing CF: –₹45 Cr (dividends & interest)
• Net Cash Flow: +₹4 Cr

9. Ratios – Sexy or Stressy?

• Debtor Days: 117 | Inventory Days: 59 | Payable Days: 71 | Cash Conversion: 105 days
• ROCE: ~16% | Debt/Equity: 0.16× | Dividend Payout: 28%

10. P&L Breakdown – Show Me the Money

11. Peer Comparison – Who Else in the Game?

12. Miscellaneous – Shareholding, Promoters

• Promoters: 49.36% (down from 56.23% in Jun ’25 after rights issue allotment)
• FIIs: 2.13% | DIIs: 0.17% | Public: 48.30%
• No. of Shareholders: 4.41 Lakh

13. EduInvesting Verdict™
    Lloyds Engineering has evolved into a niche EPC powerhouse, delivering healthy revenue growth, expanding margins and prudent leverage. However, at 110× earnings and 18.5× book, the stock factors in flawless execution and robust order inflows. The imminent ₹1,050 Cr rights issue will be the real litmus test: effective deployment could vindicate a premium multiple, while any missteps risk a valuation reset. Watch order conversion, capex returns and defense-sector wins closely over the next 12 months.

✍️ Written by Prashant | 12 July 2025

Tags: Lloyds Engineering, EPC, Heavy Equipment, Capital Goods, Stock Analysis, Order Book, Rights Issue, EduInvesting