1. At a Glance

A tank maker that’s too cool for rational pricing.
Inox India, the desi king of cryogenic equipment, posted a handsome ₹226 Cr profit in FY25 and flaunts an ROCE that would make Warren Buffett raise an eyebrow (38%). But the real showstopper? A 46x P/E. That’s right. You’re not just buying a business here—you’re buying hope, hydrogen hype, and a ticket to the green energy gala. Too bad no one mentioned the gala’s already priced in.

2. Introduction

If Apple made cryogenic tanks, Inox India would still trade at a lower P/E. But sadly, this isn’t Cupertino—this is Vadodara. The company, founded in 1976, designs and manufactures systems that operate in ultra-low temperatures. Its tanks are used for liquid nitrogen, oxygen, LNG, green hydrogen, and—allegedly—for chilling investor expectations too.

On the surface, everything sparkles. Zero debt. Double-digit growth. Orders from ITER, Heineken, and even the Bahamas (because why not?). But here’s the catch: even with ₹1,300+ Cr in revenues and ₹226 Cr PAT, the stock is trading at a nosebleed valuation with very little margin of safety.

3. Business Model – WTF Do They Even Do?

Inox India builds, installs, and maintains cryogenic storage systems—think vacuum-insulated tanks and trailers for ultra-cold liquids. The company’s business is broken into three segments:

• Industrial Gas (59% of Q2FY25 revenue) – For clients like Linde and Air Liquide.
• LNG Distribution – Storage tanks for LNG stations.
• Cryo Scientific & Beverage – Supplying kegs (yes, beer tanks) for brands like AB InBev and Heineken.

They’ve also started exporting to 60+ countries and have patents for storage systems that sound like they were designed by Elon Musk’s interns. Barriers to entry? High. TAM? Niche but growing. Profitability? Hot. Pricing? Hmm.

4. Financials Overview

Latest full-year numbers (FY25):

• Revenue: ₹1,306 Cr
• EBITDA: ₹330 Cr
• Net Profit (PAT): ₹226 Cr
• EPS: ₹24.90
• ROCE: 38%
• ROE: 29%
• Debt: ₹43 Cr, but net debt is negative (cash-rich)

Recalculated P/E:

CMP ₹1,140 / EPS ₹24.90 = P/E of 45.8x
So yes, the Screener number is finally right for once.

Is this P/E reasonable? Only if you think green hydrogen is the next Bitcoin. Otherwise, you’re paying 47x for a tank company.

5. Valuation – The Fair Value Range

Let’s tone down the euphoria and calculate fairly:

A. P/E Based (Avg peer: 35x – 45x):

• Base case: 35 × ₹24.9 = ₹872
• Bull case: 45 × ₹24.9 = ₹1,120
  → Range: ₹870 – ₹1,120

B. EV/EBITDA (Peer avg: 25x – 35x):

• EBITDA = ₹330 Cr
• EV range = ₹8,250 Cr – ₹11,550 Cr
  → Market Cap ≈ EV (cash-rich) → Fair Price = ₹910 – ₹1,275

C. DCF (Based on conservative cash flow growth):

• Free cash flow around ₹120 Cr/year
• Assuming 10% growth, 12% discount: Fair value ≈ ₹700 – ₹800

🔎 Final Fair Value Range: ₹870 – ₹1,275
At ₹1,140, it’s near the upper bound. Not a bargain, but not a bubble either.

6. What’s Cooking – News, Triggers, Drama

• ₹373 Cr Orders (Jun ‘25): Across cryogenic segments, including the ITER project (yes, nuclear fusion!).
• Heineken & AB InBev Tie-Up (May ‘25): Their Savli plant got global keg approvals. Beer + tanks = cheers.
• LNG Orders from Bahamas: Because cryogenics doesn’t stop at customs.
• Green Hydrogen Projects with ISRO: India’s hydrogen dreams now have a tank.
• Credit Ratings Upgraded (Jul ‘24): CRISIL, Care, and India Ratings all threw roses.

The drama? None. But there’s a subtle risk—if hydrogen adoption lags, these tanks might stay chilling… in inventory.

7. Balance Sheet – Auditor-Approved & Boringly Safe

Comment:
This balance sheet is so clean, SEBI could use it as a case study. Zero red flags. Leverage? Practically non-existent. If anything, it’s under-leveraged.

8. Cash Flow – Sab Number Game Hai

Comment:
Ops cash is healthy. Investing outflows shot up in FY25—capex for future growth. But overall, the tank’s not leaking. Just expanding capacity.

9. Ratios – Sexy or Stressy?

Comment:
Financially hot. Almost too hot. But with high margins, return ratios and no debt, this one deserves the valuation love… at least half of it.

10. P&L Breakdown – Show Me the Money

Comment:
Consistent growth in top and bottom line. Not explosive, but not stagnant either. Margin consistency = comfort. Would be better if PAT grew faster than P/E.

11. Peer Comparison

Comment:
Inox’s valuation is in line with Esab. PTC is living on another valuation planet (P/E 359x). So, while not cheap, Inox isn’t the only expensive cryo-hunk in town.

12. Miscellaneous – Shareholding, Promoters

Comment:
Strong promoter skin in the game. DIIs and FIIs steadily increasing stake. Public holding decreasing, which is either bullish accumulation… or smart money exiting at 47x.

13. EduInvesting Verdict™

Inox India is like that IITian who aced all subjects, got a government grant to build robots, and now wants a unicorn valuation for making… tanks. But here’s the thing: they’re really good tanks. And they’re exporting them, getting patents, and scaling profitably.

The company’s fundamentals are solid. Consistent growth, great return ratios, and a squeaky-clean balance sheet. Orders are rising, and export revenue crossed 50% in Q4 FY25. Hydrogen infra could be a game-changer, and global recognition is brewing—literally (ask Heineken).

But the valuation remains frosty—cold enough to make even their tanks blush. At ~47x P/E, there’s no “value” left unless growth accelerates significantly. The upcoming quarters need to justify this price tag with more than press releases and buzzwords.

SWOT Summary:
S: Tech edge, debt-free, export-ready
W: High P/E, margin of safety missing
O: Green hydrogen, export orders, keg opportunity
T: Hydrogen hype delay, macro capex slowdown

📌 Final Word: Great business, great margins—but priced like it’s 2030. Investors might want to wait for reality to catch up before jumping into this cryogenic rocket.

Written by EduInvesting Team | 1 August 2025
SEO Tags: Inox India, Cryogenic Equipment, Hydrogen Tanks, Capital Goods, Industrial Gas Systems, Inox India Stock Analysis