Blue Cloud Softech Solutions Limited

Technology — Information Technology Services · NSE

₹19.79−₹0.08 (−0.40%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

CAUTION

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, 7:49 pm

Understanding the Business

Company site ↗

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

What does this company do?

Blue Cloud Softech Solutions Limited engages in design, development, and marketing of computer software in India and internationally.

IndustryInformation Technology Services

SectorTechnology

Annual revenue₹1,002 Cr

How does it make money?

Turns over ₹1,002 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation.

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 10.1% 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?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +3350% while net margin moved +164% 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+3350%

Margin effect+164%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of 0.30 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

60/ 100

Average

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

Valuation

65/ 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

17.8x

Sector Median

16.5x

median of 4 sector peers

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

vs. its own history

Not enough price and earnings history

vs. sector peers

Fair

16.5x median of 4 peers · +8%

vs. generic bands

Fair

15x–35x

EV/EBITDA

13.9x

PEG

0.05

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 2.6% to 12.6% over 3 years.
Return on capital is rising
ROCE has improved from 6.1% to 10.1%.
Very low debt
Debt/Equity of 0.29x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 130793% over 3 years, from ₹0 Cr to ₹269 Cr.
🔴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.
🔴Receivables growing faster than salesFinancial
Receivables up 27718% against revenue up 3350% — sales are being booked faster than they are collected.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 548% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 2.6% to 12.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

Sales are being booked faster than collected
Receivables are up 27718% against revenue up 3350%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
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.
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 169% a year✓ 225.5% CAGR
Latest reported year was 41.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 12.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹197 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✓ 10.1%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 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
✓ 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

Price history

Quick Metrics

3 good · 5 neutral · 3 weak

Market Cap

₹1,490 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

17.8x

Fair

Fairly valued against the generic band

P/B Ratio

1.62x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹1.11

Profitable

Profitable on a per-share basis

ROE

6.6%

Weak

Weak capital efficiency

ROCE

10.1%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.29x

Low

Conservative leverage

Revenue Growth (YoY)

41.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-30.3%

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

-₹197 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

9.7%

Average

Average margins

Net Margin

5.9%

Average

Average bottom-line conversion

Current Ratio

1.03

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.30

Defensive

Steadier than the market

52W Range Position

18%

Mid-range

Technical Snapshot

RSI (14)

24.6

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹29 Cr	₹502 Cr	₹797 Cr	₹1,002 Cr	+225.5%
EBITDA	₹1 Cr	₹27 Cr	₹71 Cr	₹126 Cr	+451.1%
EBITDA Margin	2.6%	5.5%	8.9%	12.6%	—
PAT (Net Profit)	₹1 Cr	₹16 Cr	₹44 Cr	₹60 Cr	+349.8%
EPS	₹0.06	₹0.49	₹1.01	₹1.13	+173.9%
ROE	5.4%	20.4%	36.3%	6.6%	—
ROCE	6.1%	26.7%	38.7%	10.1%	—
Total Debt	₹0 Cr	₹68 Cr	₹94 Cr	₹269 Cr	+993.9%
Free Cash Flow	-₹0 Cr	-₹52 Cr	-₹23 Cr	-₹197 Cr	—

🟢 Revenue has grown at 225.5% a year over 3 years.

🟢 EBITDA has grown at 451.1% a year over 3 years.

🟢 EBITDA Margin has risen from 2.6% to 12.6% over 3 years (+10.0 pts).

🟢 PAT (Net Profit) has grown at 349.8% a year over 3 years.

🟢 EPS has grown at 173.9% a year over 3 years.

🟢 ROE has risen from 5.4% to 6.6% over 3 years (+1.2 pts).

🟢 ROCE has risen from 6.1% to 10.1% over 3 years (+4.1 pts).

🔴 Total Debt has grown at 993.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1,367 Cr

Total Liabilities

₹444 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹208 Cr

Capex

-₹405 Cr

Shareholding (proxy)

Institutional Holding

7.0%

Insider Holding

75.1%

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

3 mixed3 general

Blue Cloud Softech Explores AI Partnership Options With SpaceX International

scanx.trade, 13 OctPartnership

🟡Mixed / dependsA partnership, whose value depends entirely on terms that a headline will not carry. Worth reading the filing before assuming either way.

Smallcap Stock Under Rs 50 Jumps After Acquisition Update ; Do You Own?

Goodreturns, 12 OctM&A

🟡Mixed / dependsAcquisitions change the balance sheet before they change the earnings. Look at what was paid, how it was funded, and whether debt rose.

Blue Cloud Softech Solutions Limited (BLUECLOUDS.NS) valuation measures and financial statistics

Yahoo Finance UK, 17 Oct

Blue Cloud Softech Sltn. | Stock Share Price Live

MarketSmith India, 28 Sept

BLUECLOUDS Stock Price and Chart — NSE:BLUECLOUDS

TradingView, 27 Jun

Blue Cloud Softech Signs Senegal Digital Transformation MoU; Shares Rise 2.65%

HDFC Sky, 08 OctPrice 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.

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

MiddlingBusiness Quality · Financial Health · Valuation

WeakProfitability · 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.

2 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive · see Key things to watch ↑