At a Glance
Hind Rectifiers Ltd (Hirect) just pulled off a blockbuster Q1 FY26: Revenue ₹215 Cr (+58% YoY), PAT ₹12.8 Cr (+85% YoY). The stock? Already partying at ₹1,712, hitting its 52-week high. With railway electrification on steroids, Hirect is literally riding the train to glory. 🚂
Introduction
Once a sleepy power electronics manufacturer, Hirect has transformed into the poster child of railway modernization. Its converters, inverters, and transformers now power India’s growing fleet of electric locomotives.
This quarter’s surge shows the company isn’t just hitching a ride on the railway boom – it’s driving the engine.
Business Model (WTF Do They Even Do?)
- Segments:
- Traction transformers
- Propulsion systems for locomotives
- Rectifiers, inverters, chargers, switchboards
- Clients: Indian Railways + industrial players.
- Facilities: Mumbai, Nashik, Dehradun.
Their moat? Deep expertise in railway electrification – not easily disrupted by new entrants.
Financials Overview
Q1 FY26 Highlights:
- Sales: ₹215 Cr (+58%)
- EBITDA: ₹24 Cr (OPM 11%)
- PAT: ₹12.8 Cr (+85%)
- EPS: ₹7.46
FY25 Recap:
- Sales ₹655 Cr (+27%)
- PAT ₹37 Cr (+184%)
- ROE 25.7% – stellar for an engineering firm.
Valuation
- P/E: 68 – premium, priced for growth.
- P/B: 18.4 – nosebleed levels.
- DCF: Aggressive growth needed to justify current price.
- Fair Value Range: ₹1,200 – ₹1,500.
What’s Cooking – News, Triggers, Drama
- Preferential Issue: 2 lakh warrants at ₹1,368 – ₹27 Cr funds raised.
- Sweden Branch Closure: Cutting dead weight abroad.
- Railway Electrification: Govt capex ensures multi-year demand tailwind.
Balance Sheet
Assets | ₹ Cr |
---|---|
Total Assets | 418 |
Net Worth | 160 |
Borrowings | 164 |
Liabilities | 93 |
Remark: Healthy leverage for a capex-heavy sector.
Cash Flow – Sab Number Game Hai
Year | Ops | Investing | Financing |
---|---|---|---|
FY23 | ₹33 Cr | -₹29 Cr | -₹4 Cr |
FY24 | ₹34 Cr | -₹19 Cr | -₹14 Cr |
FY25 | ₹36 Cr | -₹25 Cr | -₹11 Cr |
Comment: Consistent positive cash from operations – management discipline at play.
Ratios – Sexy or Stressy?
Metric | Value |
---|---|
ROE | 25.7% |
ROCE | 21.6% |
OPM | 11% |
D/E | 1.0 |
P/E | 68 |
Auditor’s Take: Ratios scream growth stock – but at a price.
P&L Breakdown – Show Me the Money
Year | Revenue | EBITDA | PAT |
---|---|---|---|
FY23 | ₹359 Cr | ₹15 Cr | -₹6 Cr |
FY24 | ₹655 Cr | ₹71 Cr | ₹37 Cr |
FY25 | ₹735 Cr | ₹80 Cr | ₹43 Cr |
Clearly, profits have taken off post-railway orders surge.
Peer Comparison
Company | Revenue (₹Cr) | PAT (₹Cr) | P/E |
---|---|---|---|
Kaynes Tech | 2,722 | 293 | 125 |
Honeywell Auto | 4,190 | 523 | 65 |
Hind Rectifiers | 735 | 43 | 68 |
Comment: Valuation in line with other high-growth industrial tech plays.
Miscellaneous – Shareholding, Promoters
- Promoters: 43.9%
- Public: 49.6%
- FIIs: 6.3%
Rising FII interest – a good sign of institutional confidence.
EduInvesting Verdict™
Hirect is no longer a small transformer shop; it’s a locomotive powerhouse. With strong order inflows, profit surge, and capex-friendly government policies, growth visibility is solid.
SWOT
- Strengths: Railway electrification, high ROE, niche expertise.
- Weakness: High valuation, reliance on government orders.
- Opportunities: Export traction equipment, metro projects.
- Threats: Execution delays, cost overruns.
Final Word: A high-voltage stock – not for the faint-hearted, but growth chasers will love the ride.
Written by EduInvesting Team | 29 July 2025
SEO Tags: Hind Rectifiers, Q1 FY26 Results, Railway Electrification Stocks, High ROE Engineering Companies