1. At a Glance
Q1 FY26 gave Wendt India a rough polish: while revenue rose 6–7%, PAT dropped by a stunning 34–51%. Add to that a CEO exit, promoter declassification, and a stock down 30% in a year, and you have all the ingredients for a boardroom soap opera.
2. Introduction with Hook
If you thought diamond tools were forever, try telling that to Wendt India’s shareholders.
- Q1 PAT: ₹3.78 Cr vs ₹7.68 Cr YoY
- Q1 Sales: ₹52.17 Cr (flat-ish YoY)
- Stock crash: ₹18,000 → ₹10,625 (down 41%)
- CEO Resigns, 3M and Carborundum step back
Plot twist? This cutting tools company just got cut.
3. Business Model (WTF Do They Even Do?)
Wendt India is a precision engineering firm that manufactures:
- Super Abrasives (CBN, Diamond tools)
- High-Precision Grinding Machines
- Honing, Polishing, Lapping Solutions
- Custom Tools for Auto, Defence, Aero, Ceramics
JV Structure:
- 3M’s Wendt GmbH: 37.5%
- Carborundum Universal: 37.5%
- Public and DIIs own the rest… for now
Their customers? Names you’ve seen on highways, runways, and probably your dentist’s office.
4. Financials Overview
Q1 FY26 Snapshot
- Sales: ₹52.17 Cr (YoY growth: ~2%)
- EBITDA: ₹7.28 Cr
- PAT: ₹3.78 Cr (YoY crash ~51%)
- EPS: ₹18.90
- OPM: 13.95% (lowest in 3 years)
Margins took a haircut sharper than their grinding wheels.
5. Valuation
Current Price: ₹10,625
EPS (TTM): ₹177.9
Book Value: ₹1,218
P/E: ~60x
P/B: ~8.7x
EduVal™ Fair Value Range:
- Earnings-based: ₹177 x 25–35 = ₹4,425 – ₹6,200
- Book-based: ₹1,218 x 3–4 = ₹3,650 – ₹4,870
Verdict: Seriously overpriced for a company with falling profits and vanishing promoters.
6. What’s Cooking – News, Triggers, Drama
- Q1 PAT down 50% (Management blamed “muted exports”)
- CEO Ninad Gadgil exits (stepping down Sep 15, 2025)
- Promoter Declassification: 3M and Carborundum are out
- Public shareholding zoomed to 51%
From a tight JV to a public free float — the Wendt era ends, and a new shareholder circus begins.
7. Balance Sheet
| Metric | FY25 (₹ Cr) |
|---|---|
| Equity Capital | 2 |
| Reserves | 242 |
| Borrowings | 1 |
| Other Liabilities | 56 |
| Total Liab. | 301 |
| Fixed Assets | 100 |
| CWIP | 10 |
| Investments | 52 |
| Other Assets | 139 |
Clean and light balance sheet, but doesn’t justify a ₹2,100 Cr market cap without growth.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net CF |
|---|---|---|---|---|
| FY23 | ₹33 Cr | ₹-17 Cr | ₹-16 Cr | ₹0 Cr |
| FY24 | ₹30 Cr | ₹-9 Cr | ₹-16 Cr | ₹+5 Cr |
| FY25 | ₹34 Cr | ₹-24 Cr | ₹-9 Cr | ₹+1 Cr |
Wendt is a cash machine but reinvests heavily. Still, not enough juice to lift profits in FY26.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROE | 15.1% |
| ROCE | 19.8% |
| OPM | 23% |
| P/E | 59.8 |
| Debtor Days | 107 (High) |
| Dividend Yield | 0.47% |
Ratios say “efficient”, but the market says “meh”.
10. P&L Breakdown – Show Me the Money
| FY | Sales ₹Cr | EBITDA ₹Cr | PAT ₹Cr | EPS ₹ | OPM % |
|---|---|---|---|---|---|
| FY23 | 210 | 57 | 40 | 200.45 | 27% |
| FY24 | 227 | 56 | 41 | 204.75 | 25% |
| FY25 | 234 | 53 | 39 | 197.40 | 23% |
| TTM | 237 | 49 | 36 | 177.90 | 21% |
Declining across all metrics = valuation de-rating justified.
11. Peer Comparison
| Company | CMP ₹ | P/E | ROE % | PAT TTM ₹Cr | Sales ₹Cr | OPM % |
|---|---|---|---|---|---|---|
| Timken India | 3,492 | 58.8 | 17.0 | 447 | 3,148 | 18.8% |
| Grindwell Norton | 1,794 | 57.6 | 16.0 | 346 | 2,812 | 18.3% |
| Carborundum Uni. | 992 | 52.4 | 10.8 | 361 | 4,894 | 14.6% |
| Wendt India | 10,625 | 59.8 | 15.1 | 36 | 237 | 21% |
Smallest in revenue, highest in valuation. Classic small-cap hype zone.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: Down from 75% → 37.5% → 0% (Post-declassification)
- Public Holding: Now 51%
- DIIs: 9.17%
- FIIs: Up from 0.09% → 2.35% (interesting)
- Total Shareholders: Tripled in 2 years (8k → 23k)
Retail invasion = risk of volatility ahead.
13. EduInvesting Verdict™
Wendt India is a precision player stuck in a blunt cycle. Great margins, cash flows, and a solid legacy — but growth? Missing. Promoters? Exiting. PAT? Falling.
At 60x PE, this isn’t a value stock. It’s a nostalgia stock.
Unless new leadership delivers a tech or export revolution, investors might want to keep their seatbelts tight — or their wallets shut.
Metadata
– Written by EduInvesting Team | 21 July 2025
– Tags: wendt india, q1 fy26, precision tools, super abrasives, 3m, carborundum, ceo exit, smallcap collapse
