Ace Alpha Tech Limited

Financial Services — Capital Markets · BSE

₹162.00+₹5.40 (+3.45%)

DalalBaazaar Score

71 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:44 pm

Understanding the Business

Company site ↗

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

What does this company do?

Ace Alpha Tech Limited engages in providing a range of outsourcing and information technology-enabled services in India and internationally.

IndustryCapital Markets

SectorFinancial Services

Annual revenue₹20 Cr

How does it make money?

Turns over ₹20 Cr a year. Of every ₹100 of sales, about ₹77 reaches shareholders as profit, with ₹86 left at the operating level before interest, tax and depreciation.

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC LIFE INS CO LTD, SBI LIFE INSURANCE CO 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?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE13.7%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +303% while net margin moved +14% 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+303%

Margin effect+14%

DalalBaazaar Score

71/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Trading within 10% of its 52-week high — entries here carry more pullback risk
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

80/ 100

Excellent

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

Valuation

58/ 100

Fair

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

17.7x

1.4Y Median

13.1x

17 monthly readings · mean 14.0x · range 9.8x–20.3x

Sector Median

58.4x

median of 3 sector peers

⚠️Current valuation is approximately 35% above its 1.4y median of 13.1x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟢Against its sector it trades 70% below the peer median of 58.4x.

vs. its own history

Expensive

13.1x median over 17 months · +35%

vs. sector peers

Cheap

58.4x median of 3 peers · -70%

vs. generic bands

Fair

15x–35x

EV/EBITDA

16.5x

PEG

0.27

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Return on equity is falling
ROE has dropped from 88.2% to 22.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 117.7% to 29.3% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 557% against revenue growth of 303% — customers are taking longer to pay.

Red Flags

1 item require attention · 1 high

🔴Significant margin compressionFinancial
EBITDA margin has fallen 5.2 points, from 90.9% to 85.6%.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 70% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
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 90.9% to 85.6%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The price already assumes success
The stock trades 35% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 88.2% to 22.0%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
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

1Revenue growth stays above 44% a year✓ 59.1% CAGR
Latest reported year was 91.1%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 84%✓ 85.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 28%✓ 29.8%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Valuation vs its own median of 13.1x✗ 17.7x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

7 / 10 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ 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

4 good · 5 neutral · 2 weak

Market Cap

₹284 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

17.7x

Fair

Fairly valued against the generic band

P/B Ratio

4.11x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹9.13

Profitable

Profitable on a per-share basis

ROE

29.8%

Strong

Strong capital efficiency

ROCE

29.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

91.1%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-23.4%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹9 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

20.9%

Good

Assets are working hard

Operating Margin

67.8%

Good

Healthy core-business profitability

Net Margin

62.7%

Good

Strong bottom-line conversion

Current Ratio

13.31

Comfortable

Healthy short-term liquidity

52W Range Position

96%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

151.0 / 141.2

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

60.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹5 Cr	₹15 Cr	₹16 Cr	₹20 Cr	+59.1%
EBITDA	₹4 Cr	₹14 Cr	₹15 Cr	₹17 Cr	+56.0%
EBITDA Margin	90.9%	96.0%	99.0%	85.6%	—
PAT (Net Profit)	₹3 Cr	₹11 Cr	₹11 Cr	₹15 Cr	+66.0%
EPS	₹1.89	₹6.07	₹8.68	—	—
ROE	88.2%	48.2%	34.0%	22.0%	—
ROCE	117.7%	63.5%	44.8%	29.3%	—
Free Cash Flow	₹1 Cr	₹3 Cr	₹10 Cr	-₹21 Cr	—

🟢 Revenue has grown at 59.1% a year over 3 years.

🟢 EBITDA has grown at 56.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 90.9% to 85.6% over 3 years (-5.2 pts).

🟢 PAT (Net Profit) has grown at 66.0% a year over 3 years.

🔴 ROE has fallen from 88.2% to 22.0% over 3 years (-66.2 pts).

🔴 ROCE has fallen from 117.7% to 29.3% over 3 years (-88.4 pts).

🔴 Free Cash Flow has turned negative, from ₹1 Cr to -₹21 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹73 Cr

Total Liabilities

₹4 Cr

Total Debt

—

Cash & Equivalents

₹7 Cr

Operating Cash Flow

-₹11 Cr

Capex

-₹10 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

79.8%

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC LIFE INS CO LTD	58.4x	11.3%
SBI LIFE INSURANCE CO LTD	63.9x	13.7%

Recent News

1 positive5 general

Ace Alpha Tech Limited Back-To-Back Highs: What It Means

Univest, 13 Oct

Ace Alpha Tech Ltd Peer Comparison – Compare with Others

Value Research, 29 Aug

ACE Alpha Tech (BSE: ACEALPHA) Sales Rise 103%: Profit, ROCE and P/E Explained

Kalkine India, 02 OctResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Ace Alpha Tech AGM outcome: All resolutions pass with 100% votes

scanx.trade, 24 Sept

Ace Alpha Tech Limited Share Price

Upstox, 05 May

Ace Alpha Tech Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 30 Aug

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability

MiddlingValuation

WeakRisk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 4 tripwires tripped — Valuation vs its own median of 13.1x · see Key things to watch ↑