Capricorn Systems Global Solutions Limited

Technology — Software - Application · BSE

₹27.00−₹1.42 (−5.00%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

Company site ↗

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

What does this company do?

Capricorn Systems Global Solutions Limited provides software development services. The company offers business process outsourcing and consultancy services in the fields of software and allied services; and IT enabled services. It is also involved in Agri Commodities Trading.

IndustrySoftware - Application

SectorTechnology

Employees6

Annual revenue₹29 Cr

How does it make money?

Turns over ₹29 Cr a year. Of every ₹100 of sales, about ₹1 reaches shareholders as profit, with ₹1 left at the operating level before interest, tax and depreciation. Each of its 6 employees supports ₹4.84 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹4.84 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.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 0.7% 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?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +2101% while net margin moved -85% 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+2101%

Margin effect-85%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 0.7% is weak

Quality vs. Valuation

Company Quality

53/ 100

Average

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

Valuation

34/ 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

192.9x

3Y Median

207.7x

40 monthly readings · mean 214.7x · range 109.4x–490.6x

Sector Median

16.5x

median of 4 sector peers

🟡Currently trading close to its 3y median of 207.7x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 1065% above the peer median of 16.5x.

vs. its own history

Fair

207.7x median over 40 months · -7%

vs. sector peers

Expensive

16.5x median of 4 peers · +1065%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

394.4x

PEG

3.87

Red Flags

5 items require attention · 3 high · 2 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.
🔴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.
🔴Receivables growing faster than salesFinancial
Receivables up 35022% against revenue up 2101% — sales are being booked faster than they are collected.
🟡Margins are compressingFinancial
EBITDA margin is down 5.0 points over 3 years.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 291% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

No clear supporting case emerges from the available numbers.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 5.7% to 0.7%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Sales are being booked faster than collected
Receivables are up 35022% against revenue up 2101%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 1065% 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
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 135% a year✓ 180.3% CAGR
Latest reported year was 2983.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above -1%✓ 0.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹23 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✗ 0.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 207.7x✓ 192.9x today
A re-rating above its own history needs a reason; without one it is just a higher price.

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
✓ 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

3 good · 4 neutral · 4 weak

Market Cap

₹76 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

192.9x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.74x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.14

Profitable

Profitable on a per-share basis

ROE

0.7%

Weak

Weak capital efficiency

ROCE

0.7%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

2983.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

119.9%

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

-₹23 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

1.5%

Weak

Thin margins leave little room for error

Net Margin

1.0%

Weak

Very little revenue reaches the bottom line

Current Ratio

5.33

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.43

Defensive

Steadier than the market

52W Range Position

70%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

30.9 / 27.0

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

27.8

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1 Cr	₹1 Cr	₹1 Cr	₹29 Cr	+180.3%
EBITDA	₹0 Cr	-₹0 Cr	-₹1 Cr	₹0 Cr	+37.0%
EBITDA Margin	5.7%	-17.9%	-89.8%	0.7%	—
PAT (Net Profit)	₹0 Cr	-₹0 Cr	-₹1 Cr	₹0 Cr	+49.8%
EPS	₹0.08	₹-0.21	₹-2.28	₹0.07	-4.8%
ROE	1.4%	-4.0%	-33.0%	0.7%	—
ROCE	1.9%	-4.1%	-32.9%	0.7%	—
Free Cash Flow	-₹0 Cr	-₹0 Cr	-₹0 Cr	-₹23 Cr	—

🟢 Revenue has grown at 180.3% a year over 3 years.

🟢 EBITDA has grown at 37.0% a year over 3 years.

🔴 EBITDA Margin has fallen from 5.7% to 0.7% over 3 years (-5.0 pts).

🟢 PAT (Net Profit) has grown at 49.8% a year over 3 years.

🔴 EPS has shrunk at 4.8% a year over 3 years.

🟡 ROE has held roughly flat at 0.7% over 3 years.

🔴 ROCE has fallen from 1.9% to 0.7% over 3 years (-1.2 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹32 Cr

Total Liabilities

₹5 Cr

Total Debt

—

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹23 Cr

Capex

—

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

79.3%

Corporate Actions

Ex-Dividend Date

02 Dec 1996

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 negative5 general

Capricorn Systems Global Solutions Confirms Non-Large Corporate Status for FY27

scanx.trade, 11 Oct

Capricorn Systems Global Solutions Ltd. Upper Circuit: Price and Key Data

Univest, 23 Sept

Capricorn Systems Global Solutions Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 04 Sept

Rajesh Partani PAC raises stake in Capricorn Systems to 9.14%

scanx.trade, 08 Oct

Capricorn Systems Global Solutions Ltd. Peer Comparison – Compare with Others

Value Research, 01 Sept

Schneider Electric President Systems standalone net profit declines 45.09% in the June 2026 quarter

Business Standard, 12 AugResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Watch Items

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.
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

StrongFinancial Health · Growth

MiddlingValuation

WeakBusiness Quality · 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.

2 of 5 tripwires tripped — Free cash flow remains positive; ROCE stays above 8% · see Key things to watch ↑