Tenneco Clean Air India Ltd
Tenneco Clean Air India Ltd
Consumer DiscretionaryIncorporated in 2018, Tenneco Clean Air India Limited is a subsidiary of Tenneco Inc., a global leader in designing and manufacturing clean air and powertrain products for automotive applications.[1]
Tenneco Clean Air India delivers exceptional ROE of 44% and is virtually debt-free, but trades at a steep 39.2x PE and 19.78x book value. With only 11% TTM sales growth and limited historical data, the premium valuation leaves little margin of safety for new entrants.
Key Fundamentals
Technical Indicators
Key Insights
Strengths
2- Company is almost debt free.
- Company has a good return on equity (ROE) track record: 3 Years ROE 42.0%
Weaknesses
1- Stock is trading at 20.2 times its book value
Growth Rate
AI Analysis — Bull vs Bear
anthropic claude-opus-4.6 1d agoTenneco Clean Air India delivers exceptional ROE of 44% and is virtually debt-free, but trades at a steep 39.2x PE and 19.78x book value. With only 11% TTM sales growth and limited historical data, the premium valuation leaves little margin of safety for new entrants.
- Exceptional return on equity at 44% last year and 42% 3-year average, indicating highly efficient capital deployment
- Company is almost debt-free, providing strong balance sheet resilience and financial flexibility in cyclical downturns
- Compounded profit growth of 18% over 3 years outpaces sales growth, reflecting improving operating leverage and margin expansion
- TTM profit growth of 13% demonstrates continued earnings momentum in the most recent period
- 80% of analyst ratings (4 out of 5) recommend a Buy, indicating broad Street consensus on upside potential
- Small market cap of Rs 23,248 crore in a niche auto-component segment offers potential re-rating as clean air regulations tighten in India
- TTM sales growth of 11% shows top-line acceleration versus the 4% compounded 3-year sales CAGR, suggesting demand inflection
- Stock trades at 19.78x price-to-book, an extremely rich valuation that prices in near-perfect execution for years ahead
- PE ratio of 39.2x is elevated for an auto-component company with only 11% revenue growth, offering limited valuation comfort
- Zero dividend yield means shareholders rely entirely on capital appreciation with no income cushion during drawdowns
- 3-year compounded sales CAGR of only 4% indicates sluggish top-line growth historically, raising questions about scalability
- Limited publicly available long-term data (5-year and 10-year growth metrics unavailable) makes it difficult to assess secular growth trajectory
- 1 out of 5 analysts (20%) rates the stock a Sell, flagging valuation or structural concerns at current levels
- Consumer Discretionary sector exposure makes earnings vulnerable to economic slowdowns and auto production cycle downturns
- Absence of 52-week high/low data limits technical visibility on whether the stock is near resistance or trading at extended levels
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
anthropic claude-opus-4.6 14h ago- Strong FY26 profit and revenue May 30
Reported consolidated net profit of ₹6,043.59 million for FY26 with revenue from operations rising to ₹54,039.76 million. Statutory auditors issued an unmodified opinion.
- ₹690M capacity expansion planned May 28
Will invest INR 690 million to add 2.1 million units of capacity over FY 2026-27 and FY 2027-28, signaling confidence in demand growth.
- Analyst meet on June 4 Jun 1
Management will meet analysts and institutional investors on June 4, 2026, in Mumbai in a session organized by HSBC Securities.
- Q4FY26 earnings call June 3 Jun 1
Earnings conference call scheduled for June 3, 2026, to discuss Q4 and full-year FY2026 results with a Q&A session.
TL;DR: Tenneco Clean Air India is executing well with solid FY26 profitability (₹6,044 Cr net profit on ₹54,040 Cr revenue) and committing fresh capex for capacity expansion. No visible headwinds in recent news flow. Upcoming analyst interactions and earnings call in early June could provide further color on demand outlook and margin trajectory. The trend appears positive with growth investments underway.
Quarterly Results
| Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|
| Sales | 1,169 | 1,125 | 1,326 | 1,286 | 1,281 | 1,285 | 1,552 |
| Expenses | 963 | 947 | 1,107 | 1,057 | 1,064 | 1,063 | 1,295 |
| Operating Profit | 205 | 178 | 219 | 229 | 217 | 223 | 257 |
| OPM % | 18% | 16% | 17% | 18% | 17% | 17% | 17% |
| Other Income | 1 | 19 | 6 | 31 | 12 | -22 | 11 |
| Interest | 4 | 5 | 7 | 7 | 11 | 7 | 9 |
| Depreciation | 25 | 27 | 26 | 25 | 26 | 28 | 29 |
| PBT | 177 | 165 | 192 | 227 | 192 | 165 | 231 |
| Tax % | 23% | 24% | 27% | 26% | 22% | 28% | 28% |
| Net Profit | 137 | 125 | 140 | 168 | 151 | 119 | 167 |
| EPS in Rs | 6.39 | 5.85 | 3.47 | 4.16 | 3.73 | 2.94 | 4.13 |
Profit & Loss
| Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|
| Sales | 4,827 | 5,468 | 4,890 | 5,404 |
| Expenses | 4,256 | 4,855 | 4,075 | 4,479 |
| Operating Profit | 571 | 613 | 815 | 925 |
| OPM % | 12% | 11% | 17% | 17% |
| Other Income | 59 | 69 | 41 | 32 |
| Interest | 22 | 25 | 20 | 34 |
| Depreciation | 101 | 104 | 103 | 108 |
| PBT | 508 | 553 | 733 | 816 |
| Tax % | 25% | 25% | 25% | 26% |
| Net Profit | 381 | 417 | 553 | 604 |
| EPS in Rs | 17.8 | 19.46 | 13.68 | 14.95 |
| Div. Payout % | 41% | 46% | 82% | 0% |
Balance Sheet
| Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|
| Equity Capital | 313 | 214 | 404 | 404 |
| Reserves | 895 | 766 | 1,206 | 794 |
| Borrowings | 31 | 15 | 20 | 51 |
| Other Liabilities | 1,190 | 1,140 | 1,202 | 1,288 |
| Total Liabilities | 2,429 | 2,135 | 2,831 | 2,537 |
| Fixed Assets | 631 | 608 | 582 | 582 |
| CWIP | 18 | 37 | 31 | 58 |
| Investments | 1 | 1 | 0 | 0 |
| Other Assets | 1,779 | 1,490 | 2,218 | 1,897 |
| Total Assets | 2,429 | 2,135 | 2,831 | 2,537 |
Cash Flow
| Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|
| Operating | 538 | 488 | 562 | 1,429 |
| Investing | -13 | -30 | -27 | -69 |
| Financing | -394 | -686 | -433 | -1,075 |
| Net Cash Flow | 130 | -228 | 103 | 285 |
| Free Cash Flow | 475 | 391 | 500 | 1,345 |
| CFO/OP | 118 | 98 | 93 | 190 |
Ratios
| Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|
| Debtor Days | 43 | 37 | 51 | 43 |
| Inventory Days | 42 | 31 | 31 | 35 |
| Days Payable | 100 | 86 | 101 | 108 |
| Cash Conversion Cycle | -16 | -18 | -18 | -30 |
| Working Capital Days | -9 | -7 | -8 | -4 |
| ROCE % | — | 52% | 57% | 61% |
Documents
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Company Information
Incorporated in 2018, Tenneco Clean Air India Limited is a subsidiary of Tenneco Inc., a global leader in designing and manufacturing clean air and powertrain products for automotive applications.[1]