01 — At a Glance
The Murugappa Grinder That’s Losing Money Overseas But Printing in India
- 52-Week High / Low₹1,128 / ₹748
- Q3 FY26 Revenue (Consol)₹1,291 Cr
- Q3 FY26 PAT (Consol)₹76 Cr
- TTM EPS₹12.68
- Annualised EPS (Q3 Avg × 4)₹14.87
- Book Value / Share₹197
- Price to Book3.93x
- Debt / Equity0.08x
- ROCE16.1%
- 3-Month Return-10.0%
Flash Summary: Consolidated Q3 FY26 revenue ₹1,291 Cr (+2.9% YoY), PAT ₹76 Cr (down sharply YoY due to Russia sanctions at VAW and Europe losses at Awuko/Rhodius). Standalone India delivered ₹769 Cr revenue and ₹85 Cr PAT with PBIT margin jumping to 15%. Stock at ₹781 trades at 61.6x P/E — premium to industry median 52.9x despite ROE of just 10.8%. Murugappa’s cash machine is leaking abroad. Detective note: Q4 backlog says “very strong quarter ahead”.
02 — Introduction
India’s Silent Abrasives King… With a European Hangover
Carborundum Universal (CUMI) is the Murugappa group’s quiet workhorse. It grinds, coats, fires and sells everything that makes machines cut, polish, or survive extreme heat. No memes, no metaverse, just 30%+ domestic market share in abrasives and global footprints from Germany to South Africa. Yet the consolidated numbers in Q3 FY26 look like a crime scene: Russia sanctions, European subsidiary losses, and a PAT that’s bleeding. Standalone India? Glowing like a freshly polished carbide tool.
Management’s Feb 2026 concall was classic Murugappa: calm, data-heavy, and promising a “very strong Q4” from order backlog and refractory bunching. But the overseas drags — VAW sales down 46% YoY, Awuko loss widening — are real. Stock down 10% in three months, trading at 61.6x P/E while ROE sits at 10.8%. The detective in me smells a classic case: strong India core, leaky foreign subsidiaries, and a market that’s pricing in prolonged pain.
Here’s the plot: one of India’s oldest industrial names is fighting geopolitics abroad while printing money at home. Will Q4 deliver the redemption arc, or is this another Murugappa grinder stuck in neutral? Grab your magnifying glass — the numbers are speaking.
Concall Note (Feb 2026): “Q4 will be a very strong quarter based on the order backlog.” — Management. Also: “We will take a firm call on Awuko in a year’s time” and Foskor Zirconia product pivot to Z450 only. Translation: Europe is on watch, India is on fire.
03 — Business Model: WTF Do They Even Do?
They Make Things That Make Other Things Work Harder
CUMI is basically the invisible hand that keeps every factory, car, and furnace in shape. Three segments: Abrasives (44% of Q2 FY25 revenue) — bonded, coated, super abrasives that grind and polish everything from auto parts to aerospace. Electrominerals (29%) — fused alumina, silicon carbide, zirconia grains that feed abrasives and refractories. Industrial Ceramics (22%) — wear-protection tiles, metallized ceramics, precision parts for power plants and electronics.
30%+ domestic abrasives share, second-largest silicon carbide producer globally, leader in Australian wear materials. Plants across India, Russia, Germany, South Africa, Australia. Exports now 54% of revenue (up from 45% in FY22). Capex rolling — ₹124 Cr spent in H1 FY26, full-year target ₹300 Cr. Recent acquisition: 100% Silicon Carbide Products LLC (USA) for refractory nitride-bonded parts.
Abrasives44%of revenue
Electrominerals29%of revenue
Ceramics22%of revenue
Exports54%of revenue
Fun fact: CUMI’s 477 trademarks and 84 patents include everything from “Azure S” sol-gel alumina to high-end SOFC ceramics. While we argue on Twitter about EVs killing oil, CUMI quietly supplies the ceramics and abrasives that keep the entire manufacturing ecosystem alive. No hype. Just grind.
💬 At 61.6x P/E with ROE 10.8%, is the market pricing in a flawless Q4 redemption or just pricing in permanent Europe pain? Drop your detective theory below.
04 — Financials Overview
Q3 FY26: India Strong, Overseas Leaking
Result type: Quarterly Results | Q3 FY26 EPS: ₹3.99 | Avg Q1–Q3 EPS: (₹3.25+₹3.91+₹3.99)/3 = ₹3.72 | Annualised EPS: ₹14.87
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 1,291 | 1,255 | 1,298 | +2.87% | -0.54% |
| Operating Profit | 157 | 177 | 156 | -11.3% | +0.64% |
| OPM % | 12% | 14% | 12% | -200 bps | 0 bps |
| PAT | 76 | 112 | 74 | -32.1% | +2.7% |
| EPS (₹) | 3.99 | 5.86 | 3.91 | -31.9% | +2.0% |
P/E Check: TTM EPS = ₹12.68. CMP = ₹781. P/E = 61.6x. Industry median 52.9x — trading at a premium despite ROE 10.8% and overseas drags. Standalone margins jumped QoQ to 15%, but consolidated profitability is getting crushed by VAW sanctions and Awuko losses. The market is either pricing in a flawless Q4 or hasn’t noticed the Europe red flags yet.
💬 Standalone India is firing on all cylinders but consolidated PAT is down 32% YoY. Is the 61.6x P/E justified, or are overseas subsidiaries turning this into a value trap? Comment below, detectives.
05 — Valuation: Fair Value Range
What Is This Murugappa Grinder Actually Worth?
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