Carborundum Universal Ltd: 64.7x P/E & Still Grinding Like It’s Sandpaper
1. At a Glance
Carborundum Universal Ltd (CUMI), the Murugappa group’s industrial Swiss army knife, makes everything from abrasives that chew through metal to ceramics that laugh at high temperatures, to electro-minerals that power industries worldwide. The stock is currently quoting a spicy P/E of 64.7x, proving that investors love paying luxury car valuations for a company that sells grinding wheels. With revenues crossing ₹4,900 Cr in FY25, it’s one of those “boring” companies that’s everywhere—from your drill bits to your tiles—but still manages to land itself into investor WhatsApp groups like the new Tesla.
2. Introduction
Let’s be clear: Carborundum Universal isn’t a sexy consumer tech unicorn. They don’t make flashy apps or promise you “10-minute deliveries.” What they do instead? Manufacture abrasives, ceramics, and minerals that the world actually needs.
Think of them as the unsung hero in the industrial Avengers. Without their products, factories would halt, metals wouldn’t be polished, turbines would break faster than your New Year resolutions, and semiconductors might just choke.
Now, why should you care? Because while most Indian companies are busy shouting “digital transformation,” CUMI is quietly executing global acquisitions, expanding into clean energy and EV-related materials, and managing to stay nearly debt-free (Debt-to-Equity 0.06). They are the industrial version of that kid in school who never made noise but always topped.
Revenue is split across Abrasives (44%), Electrominerals (29%), Ceramics (22%), and a tiny sliver of IT services & power generation (5%). The boring pie, but a very profitable one. Global presence? 55+ countries. Retail reach? 18,000 outlets in India. Patents? 84. Trademarks? 477. Essentially, they’re not just grinding wheels—they’re grinding competition.
3. Business Model (WTF Do They Even Do?)
Abrasives (44%) → Think sandpaper, cutting discs, grinding wheels. Basically, the weapons of choice for welders, carpenters, and even surgeons of metal. Market share? Over 30% in India. Recent acquisitions in Germany gave them a European foothold too.
Electro-Minerals (29%) → Fancy rocks turned into industrial powders—silicon carbide, alumina, zirconia. Sounds boring, but without these, you can kiss advanced ceramics, semiconductors, and refractories goodbye.
Industrial Ceramics (22%) → Precision-engineered ceramics for wear protection, metallized ceramics for aerospace/defense, and high-performance materials. They dominate Australia here.
Others (5%) → Includes IT services, renewable energy, and phase-change materials. Aka, the “we also do this” segment.
In short, their business model is: 👉 Take minerals → Process → Turn into materials → Sell to industries → Repeat. A very B2B grind, but with margins strong enough to make even FMCG folks jealous.
4. Financials Overview
Here’s the spicy Q1 FY26 numbers (Jun ’25) vs history:
Source table
Metric
Latest Qtr (Jun ’25)
YoY Qtr (Jun ’24)
Prev Qtr (Mar ’25)
YoY %
QoQ %
Revenue
₹1,219 Cr
₹1,198 Cr
₹1,217 Cr
1.8%
0.2%
EBITDA
₹121 Cr
₹194 Cr
₹146 Cr
-37.6%
-17.1%
PAT
₹61.9 Cr
₹115 Cr
₹30 Cr
-46.2%
+106%
EPS (₹)
3.25
5.94
1.53
-45.3%
+112%
YoY: Revenue is flat like a dosa, but profits have been slashed nearly 50%.
QoQ: PAT doubled, but only because last quarter was a disaster.
Annualised EPS (Jun ’25 × 4) = ₹13.0 → P/E at CMP (₹990) = 76x. Translation: Market thinks CUMI is as valuable as a tech SaaS company, but profits are behaving like a PSU.
5. Valuation (Fair Value Range Only)
P/E Method: Sector median P/E ~45. If EPS ~₹13, FV range = ₹585–₹650.
EV/EBITDA Method: FY25 EBITDA ~₹639 Cr; EV/EBITDA fair range 18–22 → FV range = ₹760–₹930.
