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The market expects Cummins India to do better than it ever has.
At today’s share price, buyers are assuming Cummins India grows about 35% a year, forever. Over the last ten years it actually grew about 18% a year. So the share price only makes sense if the business improves on its own track record. If it simply carries on as before, buyers today have paid for something they will not get.
- How it is valued: Discounted cash flow.
- What the price assumes: 35% growth, against 18% the model takes from its own record.
- Ten-year record: Between FY2018 and FY2026, Cummins India's revenue went from ₹5,190 crore to ₹12,143 crore — it compounded at about 11% a year over 8 years.
- Biggest swing factor: Data centres. Main risk: Energy transition.
01The Indian arm of a US engine maker
Cummins India, majority-owned by Cummins Inc. of the US, makes diesel and gas engines for power generation, construction, mining, railways and marine use, and sells spare parts and services.
Generator sets for backup power — especially for data centres, hospitals and offices — are its largest business, and it also exports to Cummins' global network.
02What the market is assuming
Work backwards from today's share price and you can see what buyers are quietly taking for granted. Here is the growth that price implies for Cummins India, next to what the model assumes from the company's own record.
The further apart these two numbers are, the bigger the bet a buyer at today's price is making.
03Cummins India's record, in plain numbers
Between FY2018 and FY2026, Cummins India's revenue went from ₹5,190 crore to ₹12,143 crore — it compounded at about 11% a year over 8 years. Net profit grew from ₹712 crore to ₹2,362 crore, about 16% a year — faster than revenue, so margins widened. In FY2026 it kept 19.4% of revenue as net profit — its best year in the period. The latest year added 16.9% to revenue, well ahead of its own long-run pace.
Revenue and earnings per share in ₹, return on equity and leverage as ratios — all from the filed statements.
Revenue and net profit by year (₹ crore)
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2018 | 5,190 | 712 | 13.7% |
| FY2019 | 5,697 | 743 | 13.0% |
| FY2020 | 5,191 | 706 | 13.6% |
| FY2021 | 4,360 | 635 | 14.6% |
| FY2022 | 6,171 | 934 | 15.1% |
| FY2023 | 7,772 | 1,228 | 15.8% |
| FY2024 | 9,000 | 1,721 | 19.1% |
| FY2025 | 10,391 | 2,000 | 19.2% |
| FY2026 | 12,143 | 2,362 | 19.4% |
04How Cummins India gets valued — and why
Discounted cash flowThis business is valued on the cash it is expected to generate, discounted back at its cost of capital — with growth taken from its own ten-year record rather than from guidance.
05What decides Cummins India's value
Data centres
Backup power for data centres is a fast-growing market.
Emission norms
Cleaner engines command higher prices.
Infrastructure
Construction and mining equipment demand.
Exports
Global demand adds volume.
06What could go wrong
- Energy transition. Batteries and cleaner backup could replace diesel.
- Export slowdowns. Global weakness cuts orders.
- The valuation. A high price assumes strong growth.
07What the full Cummins India valuation shows
Sign in free to see the complete Cummins India valuation
- ✓Fair value per share — from a ten-year discounted cash flow, every step shown
- ✓The Workbench — change revenue growth, the discount rate or terminal growth and watch Cummins' value move
- ✓Bull, base and bear cases — and exactly which assumptions move between them
- ✓Peer comparison — against Siemens, ABB India and other capital-goods makers
- ✓Downloadable report — the full write-up, yours to keep
08Questions people ask about Cummins India
What does Cummins India make?
Engines and generator sets for power, construction, mining and transport.
Why do data centres matter to Cummins?
They need large backup generators.
Who owns Cummins India?
Cummins Inc. of the US holds the majority.
Is Cummins India overvalued?
At ₹4,369 the market is pricing in roughly 35% sustained growth, against the ~18% its own record supports. That is more than it has delivered, so the price is justified only if the business can hold a rate it has not previously sustained.
What is the intrinsic value of Cummins India?
It is computed from the filed financial statements using the method that fits this business (discounted cash flow), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
How much debt does Cummins India carry?
Debt to equity stands at 0.00, against 0.00 at the start of the period — the balance sheet is a core input to the cost of capital used here.