The promoter group’s stake will fall to 74.2% after the IPO from 94.1%. The company has a loyal customer base with 97% of revenue coming from repeat business. With about 79% of its revenue coming from exports, including 58% from the US, the company faces geographical and tariff related risks. Additionally, It exhibited a longer working capital cycle and had negative cash flow from operations in FY25. Given these factors, investors may wait to see clarity in financials.

Business
Incorporated in 2006, Omnitech caters to customers across sectors such as energy, motion control and automation, industrial equipment systems, metal forming and others. It has three manufacturing units, all in Gujarat thereby creating geographic concentration risks. For instance, flooding from excessive rainfall in FY25 disrupted operations. It has a leased warehouse in Houston, USA. The company imports about 37% of its materials and uses hedging techniques to reduce currency risks.

Agencies

World Matters Biz is growing at high-precision components maker, but co is exposed to tariff shifts and has longer working capital cycle

Financials
Between FY23 and FY25, revenue grew by 39.1% annually to ‘342.9 crore and net profit rose 16.5% to ‘43.9 crore. Around 30% revenue comes from top three customers. The company has a longer working capital cycle – net working capital days at 256 in the six months to September. This may increase working capital needs thereby raising interest outgo.

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Cash flow from operating activities was ‘11.8 crore in the first half of FY26, but the company faced operating cash flow deficit of ’69 crore in FY25, dropping from positive cash flow of ‘39.4 crore in FY23. Though return on equity (ROE) dropped sharply to 21.6% in FY25 from 53.9% in FY23, it remains well above peer range of 6-13%. For the six months ended September 2025, the company’s revenue and net profit was ‘228.2 crore and ‘27.8 crore, respectively.
Valuation
Considering the post-IPO equity and annualised profit for FY26, the price-earnings (P/E) multiple is 50 compared with above 66 for peers including Azad Engineering, Unimech Aerospace and Manufacturing, and PTC Industries.

The international brokerage cited a more constructive outlook for aluminium prices, supportive silver prices and an attractive dividend yield of over 6% estimated for FY27. It also highlighted that significant deleveraging at the parent level reduces the risk of any increase in brand-fee rates or inter-corporate loans.

BofA has raised its FY26E–FY28E EBITDA estimates for Vedanta by 16–21%, factoring in higher aluminium price assumptions, an increased fair value for Hindustan Zinc, depreciation in the USD-INR rate and a lower holding-company discount of 5%, compared with 15% earlier.

Vedanta Q3 snapshot

Vedanta reported a 61% year-on-year jump in consolidated profit to Rs 5,710 crore for the third quarter, with revenue rising 19% to Rs 45,899 crore. EBITDA climbed 34% year-on-year and 31% sequentially to a record Rs 15,171 crore, while margins expanded sharply to 41%, supported by higher metal prices, stronger premiums, improved volumes and cost efficiencies.

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The aluminium business stood out operationally, with alumina production rising 57% year-on-year to a record 794 kilo tonnes, while aluminium cost of production declined 11% year-on-year to $1,674 per tonne, aiding margin expansion. Zinc India and international zinc operations also delivered strong growth on the back of favourable commodity prices and improved volumes.
The stronger operating performance translated into better capital efficiency, with return on capital employed improving to 27%, up nearly 300 basis points from a year ago.

Vedanta share price performance

Vedanta share price has been off to a strong start in 2026, rallying 20% on a year-to-date basis. The stock is up 60% in the last six months.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

According to Pandey, current valuations are “extremely comfortable” and most stocks are trading below their five-year averages. “As of now, it looks like most of the stocks are in oversold zone and I would say, the fears from the AI are overblown. And as most of these management we also believe that AI would provide more opportunities in the medium to long term. In fact, there can be some price deflation for certain legacy projects, but that should be more than compensated with increasing volume of IT projects,” he explained in an interview to ET Now.

Pandey emphasized that while the near-term impact might be temporary, IT companies are well-positioned for growth over the next one to two years.

When asked whether the AI disruption is materially different from previous technology shifts such as cloud and internet adoption, Pandey noted, “Even with this disruption, it is more about improvement in productivity. Revenue per employee would increase, headcount addition would be more measured, and some routine tasks can get automated. IT services companies are well entrenched in the entire IT ecosystem where they understand the client’s context and their tech journey over decades.”

He added that this productivity boost could make previously unviable legacy transformation projects feasible. “Near term we might see some disruption, but I remain positive and it looks like even for FY27 performance would be slightly better compared to what we had in FY26,” Pandey said.

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Concerns over AI reducing man-hours and impacting revenue models were addressed as well. “In this AI age I believe it would shift from man-hour base to fixed price or outcome-based projects. There has been significant increase in productivity, especially in coding hours, but for clients who were previously unable to implement IT projects, now it becomes easier and more affordable,” he said.
On margin pressure, Pandey commented, “There would be some margin compression for legacy projects. But as IT companies move towards outcome-based billing, margins would be broadly protected. For global tech companies in the US, if they cannot monetize AI properly, their margins can take a hit. There is more of a bubble case in AI for US tech companies, but for Indian companies, the opportunities are just too huge.”From an investor’s perspective, Pandey recommends patience. “Let the price stabilise, maybe it can take a month or so. But at the current valuations, if somebody has a long-term horizon… and even Q4 would be reasonably good. So, if somebody has a longer term, one can add; otherwise, they can wait for the prices to stabilise.”

He advises a balanced approach between largecap and midcap IT names. “I would say mix of a largecap and Infosys and Coforge one can have 50-50,” he said, highlighting them as top picks.

Pandey also flagged key metrics to monitor in the AI-driven IT cycle: “Companies will start reporting on deal TCV, especially AI-led deal TCV, and one needs to track the pace at which AI-led deal TCV grows. Even Infosys reported around 5.5% revenue from AI-led services and TCS had a similar number at around 5.8%, that $1.8 billion. AI-led revenue, AI-led deal TCV, and how the mix is changing quarter to quarter needs to be tracked. Plus, headcount addition is still important to keep their employee pyramid intact.”

With measured optimism, Pandey believes the Indian IT sector is poised to navigate AI disruption while delivering value to long-term investors.