Breaking Down Jyoti CNC Automation Limited Financial Health: Key Insights for Investors

Curious whether Jyoti CNC Automation Limited is a growth story or an overvalued bet? The numbers demand attention: Q2 FY26 revenue rose to ₹507.90 crore (up 17.93% year‑on‑year) and FY25 revenue jumped to ₹1,817.70 crore (up 35.80%), with the aerospace segment contributing over 40% of sales and an order book that expanded 26% in the September quarter to ₹42,893 million; profitability shows strength too, with Q2 FY26 net profit at ₹85.50 crore (+12.68%), full‑year net profit at ₹316.01 crore (+109.47%), EBITDA of ₹125 crore and ROE of 18.74% versus a 5‑year average of 11.06%, while the balance sheet reflects a debt‑free stance as of March 31, 2025 and rising retained earnings of ₹444.61 crore-offset by valuation and market metrics such as a P/E of 60 (11/10/2025) and a 52‑week range of ₹750.10-₹1,504.30; investors should weigh liquidity (strong current and quick ratios, positive operating cash flow), significant investing outflows of ₹328.96 crore, planned capex of ₹400-450 crore to reach 16,000 machines pa by FY27, technology bets (patent‑pending HMI, seven new products) and expansion potential (Huron France up to $80m revenue) against execution, FX, supply‑chain and global trade risks-dive into the full analysis for detailed chapter‑by‑chapter insights.

Jyoti CNC Automation Limited (JYOTICNC.NS) - Revenue Analysis

• Revenue: ₹507.90 crore, up 17.93% from ₹430.67 crore in Q2 FY25.
• Order book: improved 26% in the September quarter to ₹42,893 million from ₹34,037 million at end-June.

• Revenue: ₹1,817.70 crore, a 35.80% increase from ₹1,338.47 crore in FY24.
• Segment mix highlights:
  • Aerospace: >40% of revenue.
  • Auto & auto components: second-largest contributor (share not explicitly stated by company; key growth driver).
  • Electronics Manufacturing Services (EMS): ~17% of revenue.

• Aerospace: global market projected to reach ~USD 1,388 billion by 2030, CAGR ~8.2% - underpinning the company's >40% exposure to aerospace demand.
• Auto/Auto components: tailwinds from electrification; global EV market forecast CAGR ~17.8% during 2024-2030.
• EMS: expected to grow ~34% annually till FY26, targeting ~USD 54.21 billion - supporting the company's ~17% EMS revenue exposure.

Jyoti CNC Automation Limited (JYOTICNC.NS) - Profitability Metrics

• Q2 FY26 net profit: ₹85.50 crore (up 12.68% from ₹75.88 crore in Q2 FY25).
• Q2 FY26 profit before tax (PBT): ₹109.05 crore (up 10% from ₹99.42 crore in Q2 FY25).
• Q2 FY26 EBITDA: ₹125 crore - a 16.9% increase year-over-year, delivering an EBITDA margin of 24.5%.
• Q2 FY26 operating profit margin (OPM): 24.53% (slightly down from 24.75% in Q2 FY25).
• FY ending March 31, 2025 net profit: ₹316.01 crore (up 109.47% from ₹150.86 crore in FY24).
• Return on equity (ROE) for FY25: 18.74%, materially above the 5-year average ROE of 11.06%.

• Year-over-year net profit more than doubled for FY25 (109.47% growth), indicating a strong recovery/expansion phase for the company.
• Quarterly EBITDA and PBT growth in Q2 FY26 points to continued operational momentum despite a marginal dip in OPM.
• The elevated ROE (18.74%) versus the 5-year average (11.06%) signals improved capital efficiency and higher returns to shareholders.

Jyoti CNC Automation Limited (JYOTICNC.NS) - Debt vs. Equity Structure

• Short-term borrowings: Nil (debt-free as of March 31, 2025)
• Preference shares: Not issued (simple equity base)
• Equity share capital: ₹1.00 crore (1,00,00,000 equity shares of ₹2 each)
• Securities premium reserve: ₹1,266.44 crore (as of March 31, 2025)
• Retained earnings: ₹444.61 crore (up from ₹305.78 crore in the prior year)

Jyoti CNC Automation Limited (JYOTICNC.NS) - Liquidity and Solvency

Jyoti CNC Automation's recent financials point to a solid short-term liquidity position and low solvency risk, driven by strong current and quick ratios, negligible leverage, and positive operating cash flow despite elevated investing outflows.

• Current ratio: 2.10 (current assets / current liabilities) - indicates comfortable coverage of short-term obligations.
• Quick ratio: 1.65 (current assets excluding inventory / current liabilities) - supports the company's ability to meet near-term liabilities without relying on inventory liquidation.
• No short-term borrowings reported - reduces refinancing and interest-rate risk.

• Large investing cash outflow (₹328.96 crore, +92.96% YoY) reflects aggressive capital deployment for capacity expansion and modernization.
• Positive operating cash flow (₹120.45 crore) provides internal funding to support capex and working capital needs, reducing reliance on external debt.
• Low debt-to-equity (0.05) and zero short-term borrowings minimize interest costs and solvency pressure, preserving financial flexibility.

For more context on ownership and market positioning, see: Exploring Jyoti CNC Automation Limited Investor Profile: Who's Buying and Why?

Jyoti CNC Automation Limited (JYOTICNC.NS) - Valuation Analysis

• Price-to-earnings (P/E) ratio on Nov 10, 2025: 60 - a premium valuation relative to industry peers.
• P/E trend: down from 123.8 in March 2024 to 60 in November 2025, reflecting stronger earnings growth and/or multiple contraction consistent with reduced investor uncertainty.
• 52-week trading range: low ₹750.10, high ₹1,504.30 - indicating pronounced market volatility over the past year.
• Analyst consensus 12-month price target: ₹1,205, implying potential upside from the current market price across the consensus set.
• Valuation context: company multiples remain higher than the industry average, pointing to elevated market expectations for growth and margin improvement.

• The halving-plus decline in P/E from 123.8 to 60 reflects either accelerating earnings, multiple normalization, or a mix of both - a central factor for re-rating potential.
• Wide 52‑week range highlights sensitivity to cycle swings, order visibility, and macro-driven demand for capital equipment.
• Consensus target at ₹1,205 suggests analyst-implied upside; combined with premium multiples, this implies market expectations for continued revenue/margin improvement.

Jyoti CNC Automation Limited (JYOTICNC.NS) - Risk Factors

• Execution risk in EMS & semiconductor projects: complex customer-side infrastructure development timelines can delay machine installations and revenue recognition, with project timelines stretching by 3-12 months in typical cases.
• Technology dependence: the company relies on imported CNC controllers for critical machine functions; the internally developed HMI reduces some dependency but does not eliminate controller supply risk.
• Global expansion challenges: planned U.S. sales office and international footprint expose the company to tariffs, changing trade policies and local certification/qualification cycles that can delay new account wins by 6-18 months.
• Currency risk: foreign exchange movements materially affect margins - management notes that a 1% adverse move in major foreign currencies can change profit before tax (PBT) by a measurable percentage of reported PBT, requiring active hedging and contract terms adjustments.
• Market and demand volatility: cyclical downturns in capital expenditure across automotive, aerospace, EMS and semiconductor sectors can compress order book growth and elongate receivable cycles.
• Supply chain and raw material risk: disruption in procurement of precision castings, linear guides, spindles and electronic parts can cause production delays and cost inflation, impacting gross margins.

• Balance-sheet and liquidity sensitivity: tight working capital cycles in capital equipment businesses mean receivable days and inventory turns are key - any elongation can increase short-term borrowing and finance costs.
• Customer concentration: pockets of revenue dependency on large OEMs or system integrators raise counterparty risk if single customers delay payments or cancel orders.

Jyoti CNC Automation Limited (JYOTICNC.NS) Growth Opportunities

• Manufacturing scale-up: target capacity of 16,000 machines per annum by FY27 with a planned capital expenditure of ₹400-450 crore to support higher production and automation.
• Product innovation: launch of seven new high-tech products, including a patent-pending HMI for CNCs and Industry 4.0 platforms to drive ASP (average selling price) improvement and differentiation.
• International expansion: Huron France subsidiary expansion nearing completion, with potential incremental revenue of up to $80 million annually once fully ramped.
• Import substitution play: focused moves into electronics and semiconductor equipment to substitute imports, capture higher-margin segments and benefit from government procurement and PLI-like incentives.
• Order visibility: order book visibility extending beyond two years, reducing revenue uncertainty and enabling capacity planning and working-capital optimization.
• Market opportunity: exposure to a global machine tool market projected at $79 billion, and to India's machine tool consumption (~$3.9 billion, ranked 6th globally).

• Revenue diversification: combination of domestic heavy-duty CNCs, high-tech electronics/semiconductor equipment and international aftermarket/service revenues from Huron France creates multiple growth vectors.
• Technology-led margin expansion: new high-ASP products (HMI, Industry 4.0) and localized manufacturing for import substitution can improve gross margins versus legacy low-ASP machine sales.
• Risk mitigation: multi-year order visibility and staged capex reduce execution and cash-flow risk while supporting disciplined scaling.