1. At a Glance
Thermax is India’s own industrial multitool—boilers, chillers, pollution control, waste recycling, and chemicals—all under one ESG-friendly umbrella. But is this climate crusader a growth engine or just a hot stock trading at luxury valuation?
2. Introduction with Hook
If climate change had a nemesis dressed in engineering steel, it’d be Thermax. The company that puts the “steam” in sustainable energy has grown its profit at a 25% CAGR over 5 years—while keeping its carbon karma clean.
- Market Cap: ₹41,507 Cr
- FY25 Revenue: ₹10,389 Cr
- Stock P/E: A spicy 66x
- Dividend Yield: A “why even bother” 0.40%
3. Business Model (WTF Do They Even Do?)
Thermax is a full-stack sustainability enabler. No, really. It serves:
- Industrial Products (40%) – Boilers, chillers, water & waste management
- Energy – Power plants, solar gear, EPC
- Environment – Air pollution control, emissions tech
- Chemicals – Ion exchange resins, performance chemicals
Customers? Cement, steel, F&B, pharma, and every factory trying not to get sued by Greta Thunberg.
4. Financials Overview
| Metric | FY25 |
|---|---|
| Revenue | ₹10,389 Cr |
| Net Profit | ₹627 Cr |
| OPM | 9% |
| ROCE | 16.2% |
| ROE | 13.4% |
Sales CAGR (3Y): 19%
PAT CAGR (3Y): 27%
No debt hangover. No margin drama. Just clean execution. (Mostly.)
5. Valuation
- P/E: 66x (yes, you read that right)
- P/B: 8.4x
- Book Value: ₹414
Fair Value Estimate (Blended):
₹2,750 – ₹3,200
Current price of ₹3,479 is pricing in FY27 optimism today. Any EPS miss, and this boiler will hiss.
6. What’s Cooking – News, Triggers, Drama
- Green Capex Boom – Demand from ESG-focused industries rising
- Export Orders – 15% of revs from overseas, growing
- Subsidiary Restructuring – FE11PL share dilution
- Q1FY25 Earnings on July 31 – Big expectations
- High Order Book – Visibility for next 4–6 quarters
7. Balance Sheet
| Metric | FY25 |
|---|---|
| Equity Capital | ₹23 Cr |
| Reserves | ₹4,914 Cr |
| Borrowings | ₹1,718 Cr |
| Total Liabilities | ₹12,008 Cr |
| Fixed Assets + CWIP | ₹3,369 Cr |
| Investments | ₹1,699 Cr |
Despite rising borrowings, it’s a capex-fueled clean balance sheet. No red flags unless you’re allergic to CWIP.
8. Cash Flow – Sab Number Game Hai
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating | 460 | 247 | 1,043 |
| Investing | -664 | -514 | -1,220 |
| Financing | 349 | 285 | 124 |
| Net Flow | 144 | 19 | -54 |
Takeaway: Strong ops cash in FY25, but capex-heavy investing outflows = near-term negative net flow. Long-term? Bullish.
9. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROE | 13.4% |
| ROCE | 16.2% |
| OPM | 9% |
| EPS | ₹53.25 |
| D/E | 0.35x |
| Dividend Payout | 25% |
Sleek margins. Respectable returns. But valuation is a bit… “Silicon Valley startup” for a Pune-based EPC firm.
10. P&L Breakdown – Show Me the Money
| Metric (₹ Cr) | FY25 |
|---|---|
| Revenue | ₹10,389 |
| Operating Profit | ₹910 |
| Other Income | ₹250 |
| Interest | ₹117 |
| Depreciation | ₹159 |
| PBT | ₹884 |
| Net Profit | ₹627 |
Margins improving YoY. But FY25 PAT is almost flat vs FY24—need better momentum.
11. Peer Comparison
| Company | Sales (₹ Cr) | PAT (₹ Cr) | ROE | P/E | OPM |
|---|---|---|---|---|---|
| ABB India | 12,268 | 1,889 | 28.8% | 62.9x | 18.9% |
| Siemens | 17,507 | 1,879 | 17.6% | 59.6x | 12.0% |
| CG Power | 9,909 | 947 | 27.6% | 112.6x | 13.3% |
| BHEL | 28,339 | 534 | 2.2% | 167x | 4.3% |
| Thermax | 10,389 | 627 | 13.4% | 66x | 9.0% |
Thermax is solid—but not the alpha in the pack. It’s a marathon runner, not a sprinter.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: 61.99% (unchanged)
- FIIs: Up from 12.2% to 15.9% in past year
- DIIs: Down from 15.8% to 12.2%
- Public Holding: ~4.4%
- Shareholders: 53,687
FIIs believe in the “clean energy + capital goods” story. DIIs, meh… are reallocating elsewhere.
13. EduInvesting Verdict™
Thermax is India’s industrial ESG poster child—efficient, ethical, and engineering-oriented. With rising global demand for green infra and emission control systems, it’s rightly placed in a multi-year tailwind zone.
But… 66x PE is a lot for a company growing PAT at 7% YoY. The business is boiling nicely, but the stock is pricing in steam that hasn’t even condensed yet.
Final Thought:
Perfect for patient believers in India’s energy transformation. Not for those expecting quarter-on-quarter fireworks. This is long-term compounding in work boots.
Metadata
– Written by EduInvesting Team | 15 July 2025
– Tags: Thermax, Boilers, ESG India, Capital Goods, Green Infra, Engineering Stocks, Climate Tech
