Unlisted Shares

Simpson & Company Limited manufactures diesel engines (10–100.5 hp) for various applications and produces paints for domestic and industrial use. Part of the Amalgamations Group, Simpson & Co. was founded in 1840 and became the first Indian company to manufacture diesel engines indigenously in 1955. It also built car bodies for Rolls Royce, Hotchkiss, and Napier.

Revenue Growth: The company's revenues have grown at a CAGR of 7.32% over the past five years. With over 65 years in operation and a diverse customer base, it has secured a significant share of the industry's revenue. About 84% of its revenue is from the domestic market, with 16% from exports.

Profitability ratios:

• ROE of the company has increased from 12.65% in FY22 to 14% in FY23.
  
• ROA has in creased from 10% in FY22 to 11.5% in FY23.

Strong promoter: Amalgamations Private Ltd., which owns 98.19% of the company, is backing Simpson and Company.

Investment Thesis: Simpson & Company Ltd. appears to be significantly undervalued compared to its industry peers, with an EV/EBITDA ratio of 10x versus the industry's adjusted multiple of 48x, reflecting a 20% discount for its non-listed status. This disparity suggests a substantial undervaluation. Additionally, Amalgamations Private Ltd. owns 98.19% of the company, resulting in no available shares for market trading. The share price ranges between ₹2 crore and ₹2.5 crore, primarily due to the limited number of shares.