WPIL Ltd Valuation Shifts to Fair Territory Amid Market Volatility

Valuation Metrics: From Expensive to Fair

WPIL Ltd currently trades at a price of ₹398.90, down 2.16% from the previous close of ₹407.70. The stock’s 52-week range spans from ₹345.55 to ₹768.00, indicating significant volatility over the past year. The company’s price-to-earnings (P/E) ratio stands at 40.56, a figure that, while still elevated, marks a shift from previously more expensive valuations. This P/E ratio now positions WPIL as fairly valued relative to its sector peers, many of whom maintain very expensive valuations.

For context, peer companies such as Elgi Equipments and KSB trade at P/E ratios of 37.93 and 49.64 respectively, both classified as very expensive. Ingersoll-Rand also commands a high P/E of 41.15, reinforcing WPIL’s relative moderation in valuation. Meanwhile, Kirl. Brothers and GK Energy, with P/E ratios of 32.33 and 23.76 respectively, are also considered fairly valued, placing WPIL in a competitive position within this peer group.

The price-to-book value (P/BV) ratio for WPIL is 2.64, which aligns with a fair valuation grade. This contrasts with the higher P/BV multiples often seen in the industrial manufacturing sector, where companies with strong growth prospects or market dominance command premiums. The enterprise value to EBITDA (EV/EBITDA) ratio of 15.21 further supports the fair valuation narrative, especially when compared to peers like KSB and Ingersoll-Rand, whose EV/EBITDA ratios exceed 30, signalling more expensive valuations.

Financial Performance and Returns: A Mixed Picture

WPIL’s return on capital employed (ROCE) is a respectable 14.73%, indicating efficient use of capital in generating earnings before interest and tax. However, the return on equity (ROE) at 6.50% suggests moderate profitability for shareholders, which may temper investor enthusiasm. Dividend yield remains modest at 0.50%, reflecting a conservative payout policy or reinvestment strategy.

Examining stock returns relative to the Sensex reveals a nuanced performance. Over the past week, WPIL’s stock declined by 4.93%, underperforming the Sensex’s 0.46% gain. Year-to-date, the stock is down 2.98%, slightly worse than the Sensex’s marginal 0.18% decline. The one-year return is particularly stark, with WPIL falling 42.89% while the Sensex gained 9.10%. However, over longer horizons, WPIL has delivered exceptional returns, with a 5-year gain of 568.34% and a 10-year return of 800.65%, far outpacing the Sensex’s respective 76.57% and 234.81% growth rates.

Mojo Score and Rating Update

MarketsMOJO recently downgraded WPIL Ltd’s Mojo Grade from Sell to Strong Sell on 13 Nov 2025, reflecting concerns about near-term price momentum and valuation risks despite the more balanced valuation metrics. The Mojo Score currently stands at 23.0, signalling weak technical and fundamental momentum. The market capitalisation grade remains low at 3, indicating limited liquidity or market interest relative to larger industrial peers.

Comparative Valuation Analysis

When benchmarked against its peer group, WPIL’s valuation appears more attractive on several fronts. While companies like Elgi Equipments, KSB, and Ingersoll-Rand are classified as very expensive with P/E ratios ranging from 37.93 to 49.64 and EV/EBITDA multiples above 27, WPIL’s fair valuation grade suggests a more reasonable price point for investors seeking exposure to industrial manufacturing.

However, it is important to note that WPIL’s PEG ratio is reported as 0.00, which may indicate either a lack of earnings growth estimates or an anomaly in data reporting. In contrast, peers such as KSB and Ingersoll-Rand have PEG ratios of 3.42 and 4.22 respectively, signalling expectations of higher growth priced into their valuations. This discrepancy warrants caution, as it may reflect uncertainty about WPIL’s future earnings trajectory.

Price Attractiveness in Context of Market Trends

WPIL’s recent price decline and valuation shift come amid broader industrial manufacturing sector volatility. The stock’s 52-week high of ₹768.00 contrasts sharply with its current price near ₹399, suggesting significant market re-rating. This re-rating may be driven by sector-specific headwinds such as raw material cost pressures, supply chain disruptions, or subdued demand in key end markets.

Despite these challenges, WPIL’s long-term return profile remains impressive, with multi-year gains far exceeding the Sensex benchmark. This historical outperformance may provide a foundation for value investors willing to tolerate short-term volatility in anticipation of a recovery.

Investor Takeaway: Balancing Valuation and Risk

WPIL Ltd’s transition from expensive to fair valuation metrics offers a nuanced opportunity for investors. The stock’s P/E and P/BV ratios now align more closely with sector averages, potentially signalling a more attractive entry point compared to its historically elevated multiples. However, the downgrade to a Strong Sell rating and weak Mojo Score highlight ongoing risks related to price momentum and market sentiment.

Investors should weigh WPIL’s solid long-term returns and reasonable valuation against the backdrop of recent underperformance and sector headwinds. The company’s moderate profitability metrics, including a 6.50% ROE and 0.50% dividend yield, suggest cautious optimism rather than a clear buy signal.

Comparative analysis with peers reveals that while WPIL is more fairly valued, other industrial manufacturing stocks maintain higher growth expectations priced into their valuations. This dynamic underscores the importance of comprehensive fundamental and technical analysis when considering WPIL as part of a diversified portfolio.

In summary, WPIL Ltd’s valuation shift reflects a recalibration of price attractiveness amid evolving market conditions. While the stock may appeal to value-oriented investors seeking exposure to industrial manufacturing, the current Strong Sell rating and recent price weakness advise prudence and thorough due diligence.

Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year (MRP = Rs. 34,999) Start Saving Now →