Aaron Industries Ltd: 77% Return, 100% Drama — Elevators Go Up, Auditors Go Out

1. At a Glance

Aaron Industries is that rare SME stock where elevators aren’t the only thing going up — the share price has given a 77% return in 1 year. Founded in 2013, the company makes elevator cabins, doors, and stainless-steel sheets. It’s also the first NSE-SME listed elevator player. Basically, they sell cabins to lift people up — but their P/E of 67.3 is already levitating way above gravity.

2. Introduction

Picture this: You’re waiting for the office lift. It’s late, smelly, and some uncle has pressed all the buttons. That’s when Aaron Industries enters the scene — promising better cabins, auto doors, and stainless-steel polish so shiny it blinds your neighbor before your portfolio does.

From a small start in 2013, Aaron has climbed floor after floor — expanding capacity, opening new units, even raising money via preferential issues. While most SMEs are busy explaining their auditors’ resignation letters, Aaron has done that too (new auditors joined FY23). Elevator pun fully intended: they’re “going up,” but only if the counterweight of debt (₹31.9 Cr) doesn’t pull them back down.

Now, should we cheer for the ₹500 Cr market cap or side-eye the price-to-book of 11.6x like an overpriced mall food court? Comment below: Do you trust SMEs with auditor switch-overs, or do you get suspicious like a Delhi landlord?

3. Business Model (WTF Do They Even Do?)

Aaron runs on two main floors:

• Elevator Division (74% of FY23 revenue): They make elevator cabins, auto doors, and designer panels. Think of them as Uber for vertical transport — except you press a button, and hopefully, it arrives.
• Steel Polishing Division (26%): Stainless steel sheets and press plates. Basically, they make shiny panels for lifts and random infrastructure projects.

Revenue mix:

• Sale of products: 94%
• Trading: 4%
• Services: 2%

Geography? A very “Swadesi” 99% revenue from India. Exports — 1%. That’s less than the amount of ketchup sachets you get with samosas.

So yes, they’re primarily a domestic elevator component play. Question for you: Would you rather they stayed desi or became global like Schindler and KONE?

4. Financials Overview

Observations:

• Revenue grew YoY, but profit fell off a cliff — classic “elevator up, earnings down.”
• EPS annualized = ₹2.04 → P/E recalculated = 117x