VARROC
Micro CapVarroc Engineering Limited
Auto
Varroc is a leading global auto technology company with a product portfolio covering electrical, electronics, lighting, polymer, metallic, after-market, and advanced safety solutions. It operates 37 manufacturing facilities and 7 technical centers across 8 countries, with 6100+ employees and 130+ patents.
One read, four checks
75+ is strong, 60-74 is usable, 45-59 is mixed, and below 45 needs caution. These are research lenses, not buy/sell instructions.
Mixed fundamentals, management trust is supportive, price trend is neutral, and recent execution is mixed.
Fundamental lens: valuation, quality, growth, balance sheet, and cash flow.
low confidence · 0/0 claims checked
Timing lens: price trend and sector relative strength.
Rolling lens: recent quarterly delivery, not the latest single-result score.
Quarter ended 31 Mar 2026
Good · 57/100Rev +13% YoY · PAT +204% YoY · operating leverage · margin compression
| Metric | This quarter | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹2,368 Cr | +12.8% | +3.5% |
| EBITDA | ₹222 Cr | +0.5% | +5.7% |
| Operating margin | 9.0% | -200 bps | +0 bps |
| PAT | ₹70 Cr | +204.3% | NDF |
| PAT margin | 3.0% | +186 bps | +344 bps |
NDF means not disclosed in the current structured filing feed. It is intentionally not treated as zero.
Where growth can come from, and what can break the case
Q4 FY26 revenue grew 12.8% YoY, with India operations up 12.0%. FY26 revenue rose 9.0% YoY. EV model revenue grew 50% YoY in Q4 and 39% YoY in FY26, reaching ~14% of Q4 revenue. Net new order wins hit a record Rs.32,889 million, with >65% from EV models.
Varroc demonstrated robust Q4 and FY26 performance, driven by strong India operations and significant EV-related order wins. The substantial new order book, largely from EV models, and continued debt reduction support the growth thesis, despite some margin pressure from overseas R&D investments.
EV Model Order Wins
Highest ever net new order wins in FY26 with >65% related to EV models, indicating future revenue potential.
Advanced Electronics & Lighting 4W R&D
Supporting growth in overseas business after non-compete expiry in Oct 2025.
Technological New Age Products
New wins in interior ambient lighting, front/rear drive inverter electronics for electric PV, and bidirectional L2V2 chargers.
India Operations Growth
India business grew 12.0% in Q4 FY26 and 10.0% in FY26, supported by strong automotive production.
Strong Domestic Automotive Production
Q4 FY26 saw strong YoY growth across 2W (20.7%), 3W (32.4%), PV (11.3%), and CV (19.5%) segments.
Buoyant Economic Activity & Consumption
FY26 growth across all segments due to buoyant economic activity and consumption boosted by GST cut.
Global R&D & Manufacturing Footprint
Leveraging R&D in India, China, Poland, Italy and manufacturing in India, Romania, Thailand, Vietnam for global customer service.
Overseas R&D Spend Impact on Margins
FY26 EBITDA margin lower by 10 bps due to increased spending on overseas R&D.
One-time VRS Spending
Net debt adversely impacted by one-time VRS spending of ~Rs. 799 million in FY26.
What management said, and what results must prove
Issuer guidance and extracted claims are tracked against later reported outcomes. Treat these as management statements, not IndiaPulse forecasts.
The company provides both YoY and QoQ comparisons for Q4 FY26, indicating the importance of both annual growth trends and sequential momentum in a dynamic auto ancillary sector. YoY shows structural growth, while QoQ reflects recent operational efficiency and market shifts.
Q4 FY26 Revenue Growth (YoY)
12.8% (Consolidated), 12.0% (India Operations), 24.0% (Overseas Business)
FY26 Revenue Growth (YoY)
9.0% (Consolidated), 10.0% (India Operations)
EV Model Revenue Growth (YoY)
Q4 FY26: 50%, FY26: 39%
EV Model Revenue Share
Q4 FY26: ~14%, FY26: ~13%
Focus on Profitable Growth
Aim for volume growth on top of inflation recovery to pave way for profitable growth.
Sustainable Margin Improvement
Achieve sustainable improvement in contribution margins through economies of scale, revenue management, and cost efficiencies.
Efficient FCF Conversion
Efficient conversion of growth in profits into growth in FCF to improve intrinsic value and create reinvestment pool.
Prudent Capital Deployment
Debt reduction, less capital-intensive investments, and prudent capital deployment in organic + inorganic growth opportunities.
Numbers and claims to verify in the next filings
| Checkpoint | Current evidence | What to verify next |
|---|---|---|
| Net New Order Wins Conversion | Rs. 32,889 million annual peak revenue potential (FY26 wins) | Monitor conversion of outstanding order book (Rs. 35,090 million end FY26) into actual revenue, especially EV-related. |
| EV Revenue Contribution | Q4 FY26: ~14% of revenue, FY26: ~13% of revenue | Track the ramp-up of EV model revenue share and its impact on overall profitability. |
| EBITDA Margin Trend | Q4 FY26: 9.7% (Consol.), FY26: 9.4% (Consol.) | Observe if overseas R&D investments translate into higher margins post non-compete expiry and scale-up. |
| Net Debt Reduction | Net Debt at Rs. 4,952 million (Mar 2026), Net Debt/EBITDA at 0.54x | Monitor continued debt reduction and FCF generation, especially after one-time expenses. |
Verification checkpoints are IndiaPulse research interpretation, not investment advice.
Trend score and candlestick chart
49NeutralSMA20 -1.4% / mo
Technical chart
VARROCweekly · 1Y+8.3%Technical trend read
NeutralTrend is undirectional — long-term trend unclear. RSI 54.
- SMA20 falling (~1.4% over last month) — short-term momentum negative.
- RSI(14) at 54 — sideways, no extreme reading.
- MACD above signal but histogram contracting — bullish momentum cooling.
- 17% off 52W high · 26% above 52W low.
Mechanical read from the price + indicator series above. Not a recommendation — technical setups can reverse without warning, especially around earnings and macro events.
Valuation, score drivers, trust methodology, financials, and peers
Use these sections after reviewing the decision summary, latest result, thesis, management accountability, and technical timing above.
Fundamental score breakdown
FAIR VALUEWhy this score?
Top U-Score contributors and drags from the latest stored fundamentals.
Positive drivers
- FCF yield is supportive at 4.7%.
- Piotroski is strong at 8/9.
- Cash flow contributes 7/10 to the score.
Main drags
- Fair-value margin of safety is negative at -19.3%.
- Valuation is weaker at 2/30; verify the latest quarterly trend.
- Balance sheet is weaker at 8/15; verify the latest quarterly trend.
Execution business valuation: EV/EBITDA plus order and working-capital risk
Capital-intensive execution stories need cash-flow and balance-sheet checks alongside valuation.
Stored run vs live recompute
This shows the stored score trend when snapshots exist, and also compares the latest stored nightly score with a live recompute from current fundamentals and price.
Score history
12 stored score snapshots. Latest stored move: +1 points.
Factor attribution
Trust asks: does management behaviour match later outcomes? Higher is better, but confidence and evidence depth matter as much as the number.
Healthy Trust: Claim history is still being built. It ranks around the 87th percentile of the scored universe and 74th percentile within Auto. No major sub-score weakness stands out.
High Trust Lite: Promoter holding is 75%. Key concern: 2 recent quarters had PAT decline worse than 25% YoY.
Generally investable credibility. Look for weak sub-scores before increasing position size.
overall median 67 · Auto: 74th pctile, median 71 · Micro: 80th pctile, median 71
0 documents indexed, but claim history is not strong enough yet.
0 claims extracted · No contradicted claim yet
How to read this Trust Score
Healthy Trust · low confidenceRead Trust alongside U-Score, result consistency, and technical trend. A cheap stock with weak Trust needs a larger margin of safety; a high Trust score does not make an expensive stock attractive by itself.
Forensic breakdown
Read low sub-scores as due-diligence warnings, not automatic sell signals.
Trust positives
- ▸Promoter holding is 75%.
- ▸Promoter pledge is zero.
- ▸FCF yield is 5.7%.
- ▸6 years of positive FCF.
Trust risks
- ▸2 recent quarters had PAT decline worse than 25% YoY.
- ▸ROE is low at 7.4%.
Trust Lite uses financial behaviour only. Prefer claim-tested Trust when enough concall claims have later outcomes.
Intrinsic value
Fundamentals
Valuation
- P/E
- 34.40
- P/B
- 4.88
- EV/EBITDA
- 8.31
- Market Cap
- 8726.00Cr
Profitability
- ROE
- 15.20%
- ROCE
- 19.00%
- ROA
- 4.72%
- Dividend Y
- 0.18%
Growth (CAGR)
- Revenue 5Y
- 15.00%
- EPS 5Y
- 19.00%
- Revenue 3Y
- 9.00%
- EPS 3Y
- 32.00%
Balance Sheet
- Debt/Equity
- 0.52
- Interest Coverage
- 6.19×
- Altman Z
- 4.72
- Book Value
- 117.00
Cash Flow
- FCF Yield
- 4.74%
- FCF Positive Y
- 7/5
- OCF
- 537.00 Cr
- EPS TTM
- 14.73
Shareholding
- Promoter Hold
- 75.00%
- Promoter Pledge
- 0.00%
- Momentum 52W
- 47%
Financial History
Updated 9/6/2026
Revenue
₹ CrNet Profit
₹ CrReturn on Equity
%Peers
Business-comparable peers in Auto — ranked by industry, sub-sector, theme-tag overlap, market cap, and U-Score similarity. Green cells mark the best available peer metric in this table.