Electrosteel Castings Limited Intrinsic Value
ELECTCAST · Capital Goods · Current price ₹77.1
Is Electrosteel Castings Limited undervalued?
We estimate the fair value of Electrosteel Castings Limited at ₹77 per share, against a market price of ₹78. That puts the share price about -0.8% above our estimate, at low confidence. This is our view of what the business is worth, not a target price or a forecast of where the share price will go.
How this fair value is calculated
This estimate comes from 2 methods: Normalized earnings (mid-cycle EV/EBITDA) (₹88), Fair multiple (P/E) (₹23). Each is weighted by how well its inputs held up for this company. The full working, including the assumptions and what data was missing, is set out below.
The range around this estimate
Our estimate for Electrosteel Castings Limited spans ₹70 to ₹88. That range is wide, which is the honest signal here: read the range rather than the single number. A margin of safety means buying meaningfully below the estimate: the wider the range, the more room the assumptions leave for error.
Margin of safety
Value investors look for a margin of safety: a discount to estimated value that absorbs being wrong. At ₹78 against an estimated value of ₹77, Electrosteel Castings Limited trades at -0.8%, i.e. a premium to our estimate. How much margin to demand depends on how much you trust the inputs, which is what the confidence band below is for.
How we got this fair value
Every number below is part of the same estimate for Electrosteel Castings Limited. Nothing here is a target price or a forecast of where the share price will go.
The inputs are thin or the models disagree sharply. This is our least reliable kind of estimate, so read the range rather than the single number.
Estimate range ₹70 – ₹88
Why this method for this business
Normalized earnings and EV/EBITDA are appropriate for a capital-intensive business like Electrosteel Castings, which is cyclical and has significant debt. Relative PE provides a sector benchmark for comparison.
The models behind the number
Each method is weighted by how well its inputs held up for this company.
Cyclical valued off mid-cycle earnings and a through-cycle EV/EBITDA (§6.6)
required inputs missing
- DCF is not suitable for a cyclical business with volatile earnings
- Book value is not relevant for an asset-heavy business
- Revenue multiples are not appropriate for a cyclical business
What was missing
- Lack of forward-looking analyst estimates for EBITDA and EPS
- Limited historical data on sector EV/EBITDA multiples
- No detailed information on capital allocation efficiency
What drives it
24 inputs, grouped by how strong each claim is
- Revenue (TTM)
- 5,918 ₹ cr
- Net debt
- 1,561 ₹ cr
- Shares outstanding
- 61,79,24,528
- Sector-median P/E
- 23.32×
- Peers used
- 30
- EPS (TTM)
- 1.96 ₹/share
- Own-history median P/E
- 7.66×
computed
computed
computed
peer-median
peer-median
computed
reconstructed (one feature, dampened — not a cap)
- EBITDA margin (cycle median)
- 13%
- Through-cycle EV/EBITDA
- 9.11×
computed (≤5y median)
own-history (median of 5y)
- Anchor correction
- peer anchor 23.3x diverges 0.3x from 6yr own-history 7.7x (no size-comparable peer) — anchor blended 0.6 toward own-history → 13.9x
- Term: quality
- -10.5%
- Term: growth
- -10.4%
- Term: capital_allocation
- +12.3%
- Term: financial_strength
- +7.2%
- Term: history
- -13.5%
- Term: sector_rerating
- +0.0%
- Term: rate_regime
- +1.2%
- Term: risk
- +0.0%
peer-anchor mismatch — deep own-history used instead
quality 34/100 (weak/erratic returns) → discount
weak ~-9% CAGR (ROCE 8% < 12% hurdle (growth not value-accretive)) → discount
capital allocation: rising ROCE funded by strong FCF → premium
financial strength: low leverage (D/E 0.2) → mild premium
history: market paid -45% vs sector, dampened ×0.3 (one feature, not the anchor)
sector re-rating: no sector-norm history → not used
rates: risk-free 6.9% below ~7.1% normal → higher multiple
risk: no analyst-dispersion signal available → neutral (lowers confidence, not PE)
- Mid-cycle EBITDA
- 769.3 ₹ cr
- Enterprise value
- 7,007.1 ₹ cr
- Net debt basis
- gross (cash unavailable)
- Premium vs sector
- -15.6%
- Fair-multiple confidence
- 74%
- Fair P/E
- 11.76×
computed
computed
note: net debt approximated by gross debt (cash unavailable)
fundamentals + macro (not capped at own history)
data completeness + term agreement
sector median × ∏(1+term) — Dynamic Fair Multiple
Who computed this
A language model (qwen3:8b) selects the valuation method and the judgement inputs for Electrosteel Castings Limited: which models suit the business, the moat, the growth and margin assumptions. It does not produce the number. The fair value itself is computed in Python by a deterministic engine (version 2026.08.1) from those inputs, so the same inputs always give the same result and every figure above can be traced to a source.
Estimated 15 Sept 2026. Re-run as new financials and news arrive.
How we value stocks
We estimate what a business is worth from its own economics: cash flows, returns on capital, and a multiple justified by its quality, rather than from where the share price has been. A fair value estimate is a view, not a verdict, and it is only as good as the inputs listed above.
Read the full fair-value methodologyMore on Electrosteel Castings Limited
DocStoX estimates are computed from reported financials, for informational purposes only, not investment advice. Consult a SEBI-registered advisor before investing.