Are Esab India latest results good or bad?

Esab India's latest financial results for the quarter ending September 2025 reflect a notable operational performance. The company reported net sales of ₹381.55 crores, which represents a year-on-year growth of 12.67% compared to ₹338.65 crores in the same quarter last year. This growth indicates the company's ability to leverage robust demand across key sectors such as shipbuilding, petrochemicals, construction, and energy.
The net profit for the quarter surged to ₹79.20 crores, marking an impressive year-on-year increase of 83.50% from ₹43.16 crores in the previous year. This substantial profit growth is supported by an operating profit margin of 18.93%, which is the highest recorded in the last seven quarters and reflects improved pricing power and operational efficiencies.

Additionally, the company's return on equity (ROE) stands at an exceptional 47.59%, showcasing its strong capital efficiency. The operational metrics suggest that Esab India is effectively managing its costs, with employee expenses declining even amidst higher business volumes, indicating improved productivity.

However, it is important to note that despite these strong quarterly results, the company has experienced a decline in its stock performance year-to-date, underperforming the broader market. This has led to an adjustment in its evaluation, reflecting the market's cautious stance regarding the sustainability of its premium valuation in light of potential growth moderation.

In summary, Esab India's latest results demonstrate strong operational performance with significant growth in both revenue and profit, underpinned by effective cost management and high capital efficiency. Nonetheless, the company's recent stock performance raises questions about its valuation in the current market environment.