1. At a Glance
Salzer Electronics is a 40-year-old electrical solutions veteran building everything from rotary switches to smart meters. Yet, while revenue wires are hot, profit capacitors are a little undercharged. CMP: ₹852 | Mcap: ₹1,507 Cr | P/E: 32.7x
2. Introduction with Hook
Imagine a factory buzzing with machines building everything from wires to smart meters. Now imagine the profits tripping just when the fan started turning.
That’s Salzer in FY25.
- Revenue: ₹1,418 Cr (all-time high)
- Net Profit: ₹52 Cr (meh)
- P/E: 32.7x (hope lives)
Despite full load, the earnings inverter still sputters.
3. Business Model – WTF Do They Even Do?
Salzer = India’s Schneider-lite, delivering customised electrical solutions across:
- Industrial Switchgears (rotary switches, relays, contactors)
- Wires & Cables (enamelled wires, flexible busbars)
- Building Electricals (MCBs, modular switches)
- Energy Management (energy savers, smart meters)
- OEM Solutions (CTs, panels, wire harnesses)
Basically: everything between a substation and your switchboard.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue (₹ Cr) | 1,037 | 1,166 | 1,418 |
| EBITDA (₹ Cr) | 96 | 117 | 134 |
| Net Profit (₹ Cr) | 40 | 47 | 52 |
| EPS (₹) | 23.9 | 26.4 | 26.0 |
| ROE (%) | 9% | 9% | 9.04% |
| ROCE (%) | 12% | 13% | 13.1% |
Profit margins improved… marginally.
5. Valuation – What’s This Stock Worth?
Valuation is currently running on moderate optimism:
- EPS (TTM): ₹26
- Sector average P/E: 25–30x
- Salzer P/E: 32.7x
Fair Value Range (based on 25–30x EPS): ₹650 – ₹780
CMP ₹852 = slight premium. Needs earnings upgrade to justify.
6. What-If Scenarios
| Scenario | Outcome |
|---|---|
| ₹192 Cr SPV (Effilume) succeeds | Big push to Energy Efficiency biz |
| Smart Meter orders scale | Margin expansion, better product mix |
| Input costs rise again | Margins could take a hit |
| Debt stays high | Interest drag continues |
7. What’s Cooking – News, Triggers, Drama
- Effilume SPV: Salzer launched ₹192 Cr SPV for energy-saving projects in Bengaluru
- Q4 PAT down 27% QoQ: Despite revenue uptick
- Promoter stake slowly increasing: From 32% to 37.5% in 2 years
- FIIs trimming: 6% → 2.35%
Electrifying moves, but not enough sparks yet.
8. Balance Sheet
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital (₹ Cr) | 16 | 17 | 18 |
| Reserves (₹ Cr) | 392 | 456 | 527 |
| Borrowings (₹ Cr) | 281 | 312 | 422 |
| Fixed Assets (₹ Cr) | 245 | 269 | 309 |
| Total Assets (₹ Cr) | 895 | 993 | 1,180 |
Borrowings continue to rise. CAPEX funded mostly by debt.
9. Cash Flow – Sab Number Game Hai
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Cash from Ops (₹ Cr) | 23 | 24 | –11 |
| Cash from Investing (₹ Cr) | –35 | –45 | –79 |
| Cash from Financing (₹ Cr) | 18 | 16 | 91 |
| Net Cash Flow | 6 | –5 | 0 |
Negative ops cash in FY25 = working capital stretch + capex pressure.
10. Ratios – Sexy or Stressy?
| Ratio | FY24 | FY25 |
|---|---|---|
| ROCE (%) | 13% | 13.1% |
| ROE (%) | 9% | 9.04% |
| Debtor Days | 104 | 104 |
| Inventory Days | 133 | 126 |
| Payable Days | 47 | 52 |
| CCC | 191 | 179 |
Efficient ops. Decent metrics. But no fireworks either.
11. P&L Breakdown – Show Me the Money
| Quarter | Revenue (₹ Cr) | Net Profit (₹ Cr) | OPM (%) |
|---|---|---|---|
| Mar 2024 | 327 | 13 | 10% |
| Jun 2024 | 357 | 15 | 9% |
| Sep 2024 | 344 | 27 | 10% |
| Dec 2024 | 341 | 15 | 11% |
| Mar 2025 | 376 | 11 | 8% |
Consistent revenue. But bottom-line zig-zags.
12. Peer Comparison
| Company | P/E | ROCE % | OPM % | Mcap (₹ Cr) |
|---|---|---|---|---|
| Genus Power | 38.0 | 19.2 | 19.2% | 11,146 |
| Shilchar Tech | 41.2 | 71.3 | 29.7% | 6,074 |
| Waaree Energies | 48.0 | 35.1 | 18.8% | 89,690 |
| Salzer Elec | 32.7 | 13.1 | 9.4% | 1,507 |
Translation: Salzer is still the underdog in a high-voltage sector.
13. EduInvesting Verdict™
Salzer is a slow and steady electricals play—not a “shocking” multibagger, but definitely not a short-circuit either.
Growing revenue, new energy SPV, and expanding margins = green lights. But debt pile-up and sluggish PAT growth = caution signs.
This one’s for long-haul voltage believers.
Metadata
– Written by EduInvesting Analyst | July 20, 2025
– Tags: Salzer Electronics, Electrical Equipment, Smart Meters, Capital Goods, Energy Efficiency
