Accel Limited

Technology — Information Technology Services · BSE

₹11.48+₹0.25 (+2.23%)

DalalBaazaar Score

52 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by moderate debt load, short-term liabilities exceed short-term assets, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Short-term liquidity is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:59 pm

Understanding the Business

Company site ↗

The 60-second version of Accel Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Accel Limited, together with its subsidiaries, engages in the information technology service, animation, engineering, real estate, and academic businesses in India and internationally. It operates through Realty, and IT Services segments.

IndustryInformation Technology Services

SectorTechnology

Employees1,187

Annual revenue₹155 Cr

How does it make money?

Turns over ₹155 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹9 left at the operating level before interest, tax and depreciation. Each of its 1,187 employees supports ₹13.1 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹13.1 lakh

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 6.7% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE32.0%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +3% while net margin moved +82% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+3%

Margin effect+82%

DalalBaazaar Score

52/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROCE of 6.7% is below 10% — capital is not working hard
✗ ROCE has fallen by 5.8 points — returns are eroding
✗ EBITDA margin of 9.0% is thin — little cushion if costs rise
✗ Net margin of 2.1% is slim
• Revenue has compounded at 1.0% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

48/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

74/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

18.5x

3Y Median

41.6x

40 monthly readings · mean 38.2x · range 12.1x–55.4x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 55% below its 3y median of 41.6x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟡Against its sector it is priced broadly in line with the peer median of 16.5x.

vs. its own history

Cheap

41.6x median over 40 months · -55%

vs. sector peers

Fair

16.5x median of 4 peers · +12%

vs. generic bands

Fair

15x–35x

EV/EBITDA

9.0x

PEG

0.79

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 11% over 3 years.
Return on equity is rising
ROE has improved from 4.5% to 7.8%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 12.6% to 6.7% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.3x — little room if earnings dip.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 7.5 points, from 16.5% to 9.0%.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.84 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 55% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 16.5% to 9.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 4.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Growth barely outpaces inflation
Revenue compounding at 1.0% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 7%✓ 9.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 1.3x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 4% a year✗ 1.0% CAGR
Latest reported year was 10.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹10 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 11 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✗ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

6 good · 3 neutral · 2 weak

Market Cap

₹67 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

18.5x

Fair

Fairly valued against the generic band

P/B Ratio

0.94x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.62

Profitable

Profitable on a per-share basis

ROE

7.8%

Weak

Weak capital efficiency

ROCE

6.7%

Weak

Low return on total capital employed

Debt/Equity

0.92x

Moderate

Moderate leverage

Revenue Growth (YoY)

10.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

190.2%

Healthy

Profits growing at a healthy clip

Dividend Yield

2.61%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹10 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

3.2%

Weak

Thin margins leave little room for error

Net Margin

2.1%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.84

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.71

Defensive

Steadier than the market

52W Range Position

34%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

11.9 / 12.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

27.2

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹151 Cr	₹161 Cr	₹156 Cr	₹155 Cr	+1.0%
EBITDA	₹25 Cr	₹19 Cr	₹16 Cr	₹14 Cr	-17.5%
EBITDA Margin	16.5%	12.0%	10.0%	9.0%	—
PAT (Net Profit)	₹3 Cr	₹3 Cr	₹2 Cr	₹5 Cr	+23.3%
EPS	₹0.5	₹0.57	₹0.32	₹0.93	+23.0%
ROE	4.5%	5.0%	2.8%	7.8%	—
ROCE	12.6%	9.3%	9.6%	6.7%	—
Total Debt	₹70 Cr	₹74 Cr	₹64 Cr	₹63 Cr	-3.7%
Free Cash Flow	₹9 Cr	₹15 Cr	₹9 Cr	₹10 Cr	+2.8%

🟡 Revenue has been broadly flat over 3 years (1.0% a year).

🔴 EBITDA has shrunk at 17.5% a year over 3 years.

🔴 EBITDA Margin has fallen from 16.5% to 9.0% over 3 years (-7.5 pts).

🟢 PAT (Net Profit) has grown at 23.3% a year over 3 years.

🟢 EPS has grown at 23.0% a year over 3 years.

🟢 ROE has risen from 4.5% to 7.8% over 3 years (+3.3 pts).

🔴 ROCE has fallen from 12.6% to 6.7% over 3 years (-5.8 pts).

🟢 Total Debt has shrunk at 3.7% a year over 3 years.

🟢 Free Cash Flow has grown at 2.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹177 Cr

Total Liabilities

₹108 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹10 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

71.8%

Corporate Actions

Dividend Rate

₹0.3

Ex-Dividend Date

22 Sept 2025

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

1 mixed5 general

Peak XV, Accel-backed Zetwerk seeks $2.64 billion valuation in India IPO

Reuters, 12 Oct

Accel Entertainment, Inc. Stock 12‑Month Price Target Raised to $16.12, Implies 47% Upside

TradingView, 07 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Amagi Media Labs Share Price: Accel, Trudy Holdings and AVP I Fund Sell 4.84% for Rs 587.3 Crore

Univest, 24 Aug

Accel India IV sells 2 crore Urban Company shares in open market

scanx.trade, 13 Aug

Accel, 2 others sell nearly 5% stake in Amagi Media Labs for Rs 587 crore

The Economic Times, 21 Aug

2 Stocks Under $50 Worth Investigating and 1 We Brush Off

StockStory, 16 Oct

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongGrowth · Valuation

MiddlingFinancial Health · Profitability

WeakBusiness Quality · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Interest cover stays above 3x; Revenue growth stays above 4% a year · see Key things to watch ↑