Amagi Media Labs Limited

Technology — Software - Application · NSE

₹564.45+₹1.05 (+0.19%)

DalalBaazaar Score

52 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, negative free cash flow, small-cap size, which brings sharper price swings.

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Amagi Media Labs Limited operates as a software-as-a-service company that connects media companies to their audiences through cloud-native technology in India, the United States, Europe, the Asia Pacific, and the Middle East.

IndustrySoftware - Application

SectorTechnology

Employees977

Annual revenue₹1,506 Cr

How does it make money?

Turns over ₹1,506 Cr a year. Of every ₹100 of sales, about ₹5 reaches shareholders as profit, with ₹7 left at the operating level before interest, tax and depreciation. Each of its 977 employees supports ₹1.54 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin7.3%

Net margin4.8%

Revenue / employee₹1.54 Cr

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.

TATA CONSULTANCY SERV LTP/E 17.3x · ROE 45.6%

INFOSYS LIMITEDP/E 15.8x · ROE 32.0%

HCL TECHNOLOGIES LTDP/E 20.4x · ROE 24.6%

WIPRO LTDP/E 14.5x · ROE 15.9%

What is its competitive advantage?Little sign of one

Returns on capital of 5.0% 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.

ROCE5.0%

ROE4.1%

Peer median ROE32.0%

What is the outlook?

5 analysts covering the stock expect revenue to grow about 22.1% and earnings to grow about 58.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+22.1%

Est. earnings growth+58.5%

Analysts5

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +121% while net margin moved -110% 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+121%

Margin effect-110%

DalalBaazaar Score

52/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 119.1x is demanding — it needs sustained high growth to justify
✗ P/B of 7.15x is a steep premium to book

Quality vs. Valuation

Company Quality

61/ 100

Average

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

Valuation

24/ 100

Expensive

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

119.1x

Sector Median

16.5x

median of 4 sector peers

⚠️Against its sector it trades 620% above the peer median of 16.5x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Expensive

16.5x median of 4 peers · +620%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

119.1x

P/B

7.15x

EV/EBITDA

108.8x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from -46.0% to 7.3% over 3 years.
Return on equity is rising
ROE has improved from -49.8% to 4.1%.
Return on capital is rising
ROCE has improved from -42.5% to 5.0%.

🔴 What Needs Attention2

Debt is rising
Total debt is up 28% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.

Red Flags

4 items require attention · 2 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 1.76x — earnings must service borrowings before shareholders see anything.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Debt is increasingFinancial
Total debt is up 28% over 3 years.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹32 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -46.0% to 7.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 1.76x. Interest is payable whether or not the business has a good year.
A premium to the sector to defend
It trades 620% above the peer median. That premium needs a reason that persists, or it closes.
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
Small 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.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

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

1Revenue growth stays above 23% a year✓ 30.3% CAGR
Latest reported year was 32.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 5%✓ 7.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹32 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ 5.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 12 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
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

3 good · 2 neutral · 6 weak

Market Cap

₹12,211 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

119.1x

Expensive

Expensive — verify against sector peers

P/B Ratio

7.15x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹4.74

Profitable

Profitable on a per-share basis

ROE

4.1%

Weak

Weak capital efficiency

ROCE

5.0%

Weak

Low return on total capital employed

Debt/Equity

1.76x

High

High leverage

Revenue Growth (YoY)

32.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

645.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

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

Free Cash Flow

-₹32 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹564.45

P/E (Forward)

37.7x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

5.5%

Average

Average margins

Net Margin

6.3%

Average

Average bottom-line conversion

Current Ratio

3.98

Comfortable

Healthy short-term liquidity

52W Range Position

61%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

565.3 / 580.9

Bearish alignment (short < long)

RSI (14)

47.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹681 Cr	₹879 Cr	₹1,163 Cr	₹1,506 Cr	+30.3%
EBITDA	-₹313 Cr	-₹219 Cr	-₹32 Cr	₹110 Cr	—
EBITDA Margin	-46.0%	-25.0%	-2.8%	7.3%	—
PAT (Net Profit)	-₹321 Cr	-₹245 Cr	-₹69 Cr	₹72 Cr	—
EPS	₹-14.85	₹-11.32	₹-3.18	₹3.43	—
ROE	-49.8%	-49.3%	-13.5%	4.1%	—
ROCE	-42.5%	-24.6%	-8.4%	5.0%	—
Total Debt	₹24 Cr	₹31 Cr	₹36 Cr	₹31 Cr	+8.7%
Free Cash Flow	-₹267 Cr	-₹191 Cr	₹29 Cr	-₹32 Cr	—

🟢 Revenue has grown at 30.3% a year over 3 years.

🟢 EBITDA has turned positive, from -₹313 Cr to ₹110 Cr.

🟢 EBITDA Margin has risen from -46.0% to 7.3% over 3 years (+53.3 pts).

🟢 PAT (Net Profit) has turned positive, from -₹321 Cr to ₹72 Cr.

🟢 EPS has turned positive, from ₹-14.85 to ₹3.43.

🟢 ROE has risen from -49.8% to 4.1% over 3 years (+53.9 pts).

🟢 ROCE has risen from -42.5% to 5.0% over 3 years (+47.6 pts).

🔴 Total Debt has grown at 8.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,353 Cr

Total Liabilities

₹596 Cr

Total Debt

₹31 Cr

Cash & Equivalents

₹235 Cr

Operating Cash Flow

-₹9 Cr

Capex

-₹23 Cr

Shareholding (proxy)

Institutional Holding

70.6%

Insider Holding

25.3%

Analyst Consensus

Recommendations

5 Buy · 1 Hold · 0 Sell

Target Price (Mean)

₹646.67

+14.6% vs CMP

Target Range

₹480 – ₹700

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

2 mixed4 general

Compare with

Equitymaster, 18 Oct

Amagi Media Labs Share Price Target 2027 to 2030: Analyst Outlook

Univest, 17 AugAnalyst view

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

Amagi Media Labs Limited (AMAGI) Share Price NSE

TechGraph, 08 Oct

Amagi Media Labs Ltd Key Financial Ratios – Valuation, Profitability & More

Value Research, 31 Aug

Amagi Media Labs shares jump over 7% amid Rs 600 crore block deal

Moneycontrol.com, 21 AugPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

AMAGI MEDIA LABS LIMITED Share Price

Upstox, 05 May

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🔴Business QualityWeak8.7/20

🟡Financial HealthAdequate10.6/20

🟢GrowthStrong18.4/20

🟡ProfitabilityModerate8.3/15

🔴ValuationDemanding3.2/15

🔴RiskHigh2.9/10

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.

This thesis breaks if

✓Revenue growth stays above 23% a year30.3% CAGR
✓EBITDA margin holds above 5%7.3%
✗Free cash flow remains positive-₹32 Cr
✓Debt / EBITDA stays below 2x0.3x
✗ROCE stays above 8%5.0%