Greaves Cotton Ltd Q2FY26 – From Diesel Engines to Electric Dreams, With a Detour Through Drama and Debt
1. At a Glance
Greaves Cotton Ltd (NSE: GREAVESCOT) is the 164-year-old granddaddy of Indian industrial engineering — and like most granddaddies, it’s trying very hard to look cool in the EV era. With a market cap of ₹5,142 crore, the company trades at ₹221 per share (as of Nov 4, 2025), boasting a stock P/E of 49.7, ROE of 4.1%, and a ROCE of 5.1% — numbers that scream “premium valuation, mediocre returns”.
Q2FY26 consolidated revenue clocked in at ₹815 crore, up 16% YoY, while PAT jumped 365% to ₹26.7 crore — a small number, but hey, percentage growth makes everyone look good. EBITDA margins nudged up to 6.3%, because even small victories deserve fireworks.
With its hands in everything from diesel engines to e-scooters (Ampere), cables, and even financial services, Greaves Cotton is now a “mobility buffet” for investors — you get a bit of everything: combustion nostalgia, electric ambition, and a generous helping of management musical chairs.
So, what happens when a legacy diesel player suddenly wants to lead the EV revolution while juggling eight factories, multiple subsidiaries, and a revolving door of CEOs? Grab your cup of chai, because this quarter’s results read like a corporate web series.
2. Introduction
Imagine a 164-year-old engineer suddenly downloading Ola Electric’s app and saying, “Beta, I can do this too.” That’s basically Greaves Cotton’s vibe right now.
From being the silent supplier of dependable 3W diesel engines to street hawkers and kirana distributors, the company now wants to electrify India’s roads — literally. Its electric division, Greaves Electric Mobility Ltd (GEMPL), makes e-scooters under Ampere and Eltra, and even electric rickshaws for those who prefer silent rides through noisy traffic.
But the transition hasn’t been smooth. Post FAME-II subsidy reduction and its alleged deregistration from the subsidy scheme, GEMPL’s e-scooter sales went downhill faster than a Reo Plus on full charge. Still, management insists the electric dream is alive, powered by a Ranipet factory capable of 5 lakh units per year — if the market ever cooperates.
Meanwhile, its engine division (61% of FY24 revenue) continues to keep the company’s heart beating, supplying diesel and CNG engines, power tillers, and gensets. The new CPCB IV+ compliant gensets launched in July 2024 were a nod to cleaner tech — or as Greaves calls it, “Fuel-agnostic innovation.”
On paper, the company looks like a hybrid of Cummins, Ola, and Muthoot Finance. In reality, it’s somewhere between “early turnaround” and “too many ideas, too little ROE.”
3. Business Model – WTF Do They Even Do?
Greaves Cotton operates like a desi thali — one steel plate, many flavours:
Engines (61%) – Diesel, petrol, and CNG engines, plus power gensets and tillers. Think “old reliable” — the part that keeps the lights on and salaries paid.
Electric Mobility (~23%) – Ampere scooters, Greaves Eltra electric 3-wheelers, and a lot of press releases about “green future.” Sadly, volumes dipped post-subsidy withdrawal: ~47,800 e-2Ws in FY24 vs 51,700 in FY22.
Cables & Control Levers (9%) – Courtesy of its ₹237 crore acquisition of Excel Controlinkage Pvt Ltd, this segment makes push-pull cables and levers for automobiles.
Others (7%) – Includes aftermarket services, Greaves Care, vehicle financing (Evfin), and OEM engineering services. Because why make just engines when you can also finance the vehicles that use them?
It’s the classic case of a company trying to reinvent itself — from “diesel uncle” to “EV dude” — while carrying a hangover of low margins and high expectations.
So yes, they build engines, scooters, cables, and dreams — but profitability? That’s still under construction.
If P/E above 40 excites you, congratulations — you’re an optimist. The company’s EBITDA margins at 6.3% are showing signs of improvement, but still far from industry peers like Cummins India (20%+).
So yes, numbers are better — but mostly because last year’s base was so bad it practically begged to be beaten.
5. Valuation Discussion – The Fair Value Range
Let’s play with some numbers:
(a) P/E Method EPS (annualised): ₹4.47 Industry average P/E (Capital Goods): ~39.8 So fair range = ₹4.47 × (35–45) = ₹156 – ₹201
