Artefact Projects Limited

Industrials — Engineering & Construction · BSE

₹49.90+₹0.70 (+1.42%)

DalalBaazaar Score

63 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

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

In simple words: The business is earning a fairly low return on the money invested in it, 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, 6:48 pm

Understanding the Business

Company site ↗

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

What does this company do?

Artefact Projects Limited, an engineering and project management consultancy company, provides solutions for infrastructure development in India.

IndustryEngineering & Construction

SectorIndustrials

Employees285

Annual revenue₹32 Cr

How does it make money?

Turns over ₹32 Cr a year. Of every ₹100 of sales, about ₹16 reaches shareholders as profit, with ₹27 left at the operating level before interest, tax and depreciation. Each of its 285 employees supports ₹11.3 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹11.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., ADANI PORT & SEZ LTD, SIEMENS 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 10.7% 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 ROE14.1%

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 +78% while net margin moved -45% 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+78%

Margin effect-45%

DalalBaazaar Score

63/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Revenue CAGR of 21.1% — compounding well above nominal GDP
✗ Profit has declined at 0.7% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Profit fell 7.1% in the latest year

Quality vs. Valuation

Company Quality

62/ 100

Average

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

Valuation

80/ 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

6.9x

3Y Median

8.4x

40 monthly readings · mean 8.5x · range 5.1x–13.2x

Sector Median

30.1x

median of 3 sector peers

🟢Current valuation is approximately 18% below its 3y median of 8.4x. 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 trades 77% below the peer median of 30.1x.

vs. its own history

Fair

8.4x median over 40 months · -18%

vs. sector peers

Cheap

30.1x median of 3 peers · -77%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

5.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Very low debt
Debt/Equity of 0.22x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 12.8% to 10.7% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 11.0 points, from 38.0% to 27.0%.
🔴Inventory building faster than salesFinancial
Inventory up 681% against revenue up 78% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 29% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 77% 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 38.0% to 27.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
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.
Several serious flags at once
3 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 16% a year✓ 21.1% CAGR
Latest reported year was 43.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 25%✓ 27.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹1 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.8x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✓ 10.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

5 good · 3 neutral · 3 weak

Market Cap

₹36 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

6.9x

Cheap

Cheap against the generic band

P/B Ratio

0.47x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹7.2

Profitable

Profitable on a per-share basis

ROE

7.4%

Weak

Weak capital efficiency

ROCE

10.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.22x

Low

Conservative leverage

Revenue Growth (YoY)

43.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-7.1%

Falling

Profits are shrinking

Dividend Yield

1.00%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹1 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

32.6%

Good

Healthy core-business profitability

Net Margin

15.5%

Good

Strong bottom-line conversion

Current Ratio

1.72

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.14

Defensive

Steadier than the market

52W Range Position

10%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

51.3 / 52.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

38.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹18 Cr	₹24 Cr	₹30 Cr	₹32 Cr	+21.1%
EBITDA	₹7 Cr	₹7 Cr	₹10 Cr	₹9 Cr	+8.0%
EBITDA Margin	38.0%	30.0%	34.6%	27.0%	—
PAT (Net Profit)	₹5 Cr	₹5 Cr	₹7 Cr	₹5 Cr	-0.7%
EPS	₹7.35	₹7.33	₹10.21	₹7.18	-0.7%
ROE	9.6%	8.8%	11.3%	7.4%	—
ROCE	12.8%	11.1%	14.6%	10.7%	—
Total Debt	₹12 Cr	₹10 Cr	₹15 Cr	₹15 Cr	+8.8%
Free Cash Flow	-₹1 Cr	-₹1 Cr	-₹21 Cr	-₹1 Cr	—

🟢 Revenue has grown at 21.1% a year over 3 years.

🟢 EBITDA has grown at 8.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 38.0% to 27.0% over 3 years (-11.0 pts).

🟡 PAT (Net Profit) has been broadly flat over 3 years (-0.7% a year).

🟡 EPS has been broadly flat over 3 years (-0.7% a year).

🔴 ROE has fallen from 9.6% to 7.4% over 3 years (-2.2 pts).

🔴 ROCE has fallen from 12.8% to 10.7% over 3 years (-2.1 pts).

🔴 Total Debt has grown at 8.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹114 Cr

Total Liabilities

₹44 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹0 Cr

Capex

-₹1 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

58.4%

Corporate Actions

Dividend Rate

₹0.5

Ex-Dividend Date

12 Sept 2025

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
ADANI PORT & SEZ LTD	29.9x	14.1%
SIEMENS LTD	88.8x	10.5%

Recent News

6 general

Artefact Projects wins Rs 21.13 crore work order from South Central Railway for Project Management Services

scanx.trade, 28 Sept

Artefact Projects Ltd. Financials – Balance Sheet, Profit & Loss, Cash Flow

Value Research, 03 Sept

52 Week Low Shares BSE | 52 Week Low Today | Shares Trading 52 Week Low BSE

Livemint, 16 Oct

Artefact Projects shareholders approve FY26 financials, director reappointment

scanx.trade, 24 Sept

Top stocks in focus today: Investors must watch HCL Tech, NCC, IRFC, Power Mech shares on Tue, 29 Sept | Triggers

Livemint, 28 Sept

Artefact Projects wins Rs 2.93 Cr NHAI order for supervision consultancy

scanx.trade, 02 Jul

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Valuation

MiddlingGrowth · Profitability · 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. 3 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑