Thermax Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Thermax Ltd trades at ₹4,662, in a confirmed uptrend and 13 weeks into that stage. That is +20.2% against its own 200-day average. It sits at 80% of a 52-week range of ₹2,846 to ₹5,121. On relative strength it is currently behind the NIFTY 500 on a trailing-13-week view (1 week and counting).

Today the stock is in a confirmed uptrend — week 13 of stage 2, confirmed. At ₹4,662 it trades +20.2% versus its 200-day average and sits at 80% of its 52-week range (₹2,846–₹5,121).

Against the market, two honest reads. Cumulative: over the last 10.3 years the stock moved +517% while the NIFTY 500 moved +274% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock is currently behind (1 week and counting; last ahead the week of 2026-07-10) — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

→ The trend is one thing; the bill is another. Are you paying up for it? Next: the P/E sits at the 95th percentile of its own range.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Thermax Ltd trades at 97.2× P/E, at the pricey end of its own range (95th percentile). Its long-run median P/E is 61.8×, measured across 10.4 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 97.2× is at the pricey end of its own range (95th percentile), against a long-run median of 61.8× measured over 10.4 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved +13.6% against a +19.9% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the +26.7%/yr price move, ~+17.7%/yr came from earnings growth and ~+9.0 pp from the multiple (expanding); over 10y, of the +17.8%/yr price move, ~+7.2%/yr came from earnings growth and ~+10.6 pp from the multiple (expanding). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is full against its own past, so the story rests on the earnings line underneath it, not the multiple.

→ Cheap or dear rides on the earnings. Are they actually growing? Next: the fundamental stage — where the business sits in its arc, and how growth has compounded.

Stage: Mixed Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Thermax Ltd reads as mixed on its fundamental arc. Mixed — the growth curves are steadily positive, but ROCE at 14.0% is below the 15% bar this page requires to call it Consistent. The read is built from 12 quarters across 4 curves, on partial evidence.

Why it matters: when the curves disagree, the per-curve reads above matter more than any single verdict.

Return readings here are annual, not quarterly — read as level and direction only; they can confirm the growth curves but never drive the stage on their own.

A partial read: at least one curve is short, or the returns curve is not the computed quarterly series — hold the stage word a little more loosely.

→ The stage names the trajectory. Next: the revenue line that produces it, quarter by quarter.

4-Factor Sector Score

47.0/100 — rank 1 of 3 in Capital Goods - Engineering General · 94% evidence confidence

Thermax Ltd scores 47.0 out of 100 against the 3 companies it is compared with in Capital Goods - Engineering General, ranking 1. Price leads the evidence: RS versus the benchmark is 30.1%, but earnings trajectory is weak. Wait for revenue and profit confirmation.

The four contributions add to the total exactly: 15.6 + 12.7 + 2 + 16.7 = 47. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Thermax Ltd reported ₹3,428 Cr of revenue in the Mar 26 quarter, +12.5% year on year. That is the 2nd straight quarter of year-on-year growth. Over 10 years it has compounded at 7.7% a year. The last full year, FY26, came in at ₹10,774 Cr. The last four reported quarters add to ₹10,695 Cr.

Thermax Ltd reported ₹3,428 Cr of revenue in the Mar 26 quarter, +12.5% year on year. That is the 2nd straight quarter of year-on-year growth. Over 10 years it has compounded at 7.7% a year. The last full year, FY26, came in at ₹10,774 Cr. The last four reported quarters add to ₹10,695 Cr.

FY26 revenue came in at ₹10,774 Cr (+3.7% on the year), capping 10 years at 7.7% compound. The latest quarter (Mar 26) printed ₹3,428 Cr, +12.5% year on year — the 2nd consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +2.5% growth against the decade's 7.7% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +3.1% over the last 4 quarters against +7.1%/yr over the last 8 — rolling over; TTM profit +14.7% vs +5.7%/yr — accelerating.

→ Revenue grew — did margins hold as it scaled? Next: 11.0% this quarter (+1.0 pp YoY).

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Thermax Ltd's operating margin is 11.0% in the Mar 26 quarter, +1.0 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 13 fiscal years the operating margin has ranged 7.0% to 10.0%. The current quarter is running above every full year in that window.

Thermax Ltd's operating margin is 11.0% in the Mar 26 quarter, +1.0 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 13 fiscal years the operating margin has ranged 7.0% to 10.0%. The current quarter is running above every full year in that window.

The latest quarter's operating margin is 11.0%, +1.0 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 7.0%–10.0%, and FY26's 10.0% is the top of that band — a record year.

Why the margin moved: operating margin went +1.1 pp year on year while gross margin went +3.2 pp — the gain came mostly from the gross line: input costs and pricing.

Worth repeating from the valuation section: cheap against its own history on record margins is not the same thing as cheap — a record margin flatters every ratio built on top of it.

→ Margins held — did that reach the bottom line? Next: profit +18.4% in the latest quarter.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Thermax Ltd earned ₹244 Cr of net profit in the Mar 26 quarter, +18.4% year on year. It is the 2nd consecutive quarter of growth. Full-year FY26 profit was ₹720 Cr. The 10-year compound rate is 9.8%. That is 7.1% of the quarter's revenue. The same quarter a year earlier earned ₹206 Cr.

Thermax Ltd earned ₹244 Cr of net profit in the Mar 26 quarter, +18.4% year on year. It is the 2nd consecutive quarter of growth. Full-year FY26 profit was ₹720 Cr. The 10-year compound rate is 9.8%. That is 7.1% of the quarter's revenue. The same quarter a year earlier earned ₹206 Cr.

Mar 26 profit was ₹244 Cr, +18.4% year on year — the 2nd consecutive quarter of growth. On the full year, FY26 printed ₹720 Cr (+14.8%), and the 10-year compound rate is 9.8%.

Why profit moved: revenue contributed +12.5% and the margin +1.0 pp — the quarter was revenue-led, with the margin roughly flat.

Pace comparison, last four quarters: profit +24.2% vs revenue +2.5%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

→ Profit rose — but did the cash follow? Next: 94% of the last 3 years' profit arrived as cash.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 94% of Thermax Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹542 Cr of operating cash against ₹720 Cr of profit. After ₹1,329 Cr of capital spending, ₹−787 Cr was left as free cash.

FY26: operating cash of ₹542 Cr against reported profit of ₹720 Cr, leaving free cash of ₹−787 Cr after ₹1,329 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 94% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 94%: the cash cycle held roughly steady between FY21 and FY26 — so conversion tracks profitability rather than the cycle.

Router verdict: the bigger cash user is investment — capital spending ran 6.5× depreciation over three years, so the next section's job is to check what that build-out is buying.

→ So follow the cash to where it goes. Next: ₹3,323 Cr of building over 3 years.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Thermax Ltd's cash conversion cycle runs −1 days in FY26, up from −11 days in FY21. Capital spending ran ₹3,323 Cr over the last 3 years. At FY26 sales of ₹10,774 Cr each day of that cycle holds about ₹29.5 Cr, so roughly ₹−30.0 Cr sits inside the business at any moment.

FY26: debtors at 75 days, inventory at 60 days — roughly 2.0 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of −1 days, looser than FY21's −11.

The full loop: cash goes out to suppliers and production on day 0; stock waits 60 days to sell; customers pay about 75 days after that; and suppliers themselves are paid at 135 days — netting out to the −1-day cycle.

In money terms: at FY26 sales of ₹10,774 Cr, each day of the cycle holds about ₹29.5 Cr — so the −1-day loop keeps roughly ₹−30.0 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹3,323 Cr over the last 3 fiscal years against ₹515 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹1,442 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

→ Does all this activity actually earn its cost of capital? Next: ROCE is 14% and the ROIC − WACC spread is −0.1 pp.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Thermax Ltd earns a ROCE of 14% in FY26. That is up from a trough of 10% in FY21. Return on invested capital clears the cost of that capital by −0.1 percentage points, so growth here is not yet paying for the capital it uses. The wiring behind it is 6.7% net margin on 0.81× asset turns.

FY26 ROCE is 14%, recovered from a FY21 trough of 10% — the full ladder below shows the fall and the climb, undoctored.

🚨 Why the return is what it is — the wiring (FY26): 6.7% net margin × 0.81× asset turns × 2.39× balance-sheet leverage ≈ 13.0% on equity. Margin does its share; leverage is a meaningful part of the equation.

The capstone test — ROIC − WACC: 11.9% − 12.0% = a −0.1 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. Negative — growth at these returns destroys value until the returns recover.

→ Returns like these — is the balance sheet borrowing to make them? Next: debt-to-equity is 0.42.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

Thermax Ltd carries total debt of ₹2,353 Cr against shareholder equity of ₹5,579 Cr as of Mar 26, a debt-to-equity of 0.42. On the annual view that ratio went from 0.11 in FY22 to 0.42 in FY26. Read the returns elsewhere on this page with that leverage in mind.

Mar 26: total debt of ₹2,353 Cr against shareholder equity of ₹5,579 Cr — a debt-to-equity of 0.42. On the annual view, debt-to-equity went from 0.11 (FY22) to 0.42 (FY26). Read the returns on this page with that leverage in mind.

→ Who owns this, and are they adding or leaving? Next: Foreign institutions cut 3.7 points over 8 quarters.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Foreign institutions cut 3.7 points of Thermax Ltd over 8 quarters, the biggest move on the register. That takes foreign institutions to 11.5% of the company. Domestic institutions moved +2.3 points over the same window, to 15.2%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Foreign institutions: −3.7 points over 8 quarters to 11.5%; Domestic institutions: +2.3 points over 8 quarters to 15.2%; Promoters: +0.0 points over 8 quarters to 62.0%.

Why the register moved: rotation — foreign institutions −3.7 points against domestic institutions +2.3 points over 8 quarters, with promoters holding steady — one class of institutions handing the register to the other, not a verdict change by the people closest to the numbers.

→ One last check: does the safety math agree? Next: the balance-sheet safety line.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Thermax Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

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