CG-VAK Software and Exports Limited

Technology — Software - Application · NSE

₹136.99+₹2.53 (+1.88%)

DalalBaazaar Score

55 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Strong business and financial position, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:03 pm

Understanding the Business

Company site ↗

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

What does this company do?

CG-VAK Software and Exports Limited, through its subsidiaries, provides software services worldwide.

IndustrySoftware - Application

SectorTechnology

Employees282

Annual revenue₹74 Cr

How does it make money?

Turns over ₹74 Cr a year. Of every ₹100 of sales, about ₹13 reaches shareholders as profit, with ₹20 left at the operating level before interest, tax and depreciation. Each of its 282 employees supports ₹26.4 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹26.4 lakh

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?Some evidence

ROCE of 15.7% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE32.0%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -3% while net margin moved -18% 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-3%

Margin effect-18%

DalalBaazaar Score

55/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 1.1% a year
✗ Profit has declined at 7.3% a year
✗ Profit fell 31.1% in the latest year

Quality vs. Valuation

Company Quality

49/ 100

Average

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

Valuation

87/ 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

8.0x

Sector Median

16.5x

median of 4 sector peers

🟢Against its sector it trades 52% below the peer median of 16.5x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

16.5x median of 4 peers · -52%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

4.4x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Debt is being paid down
Total debt is down 36% over 3 years.
Cash generation is improving
Free cash flow is up 40% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 22.3% to 11.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 29.0% to 15.7% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 1 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 2.96x — earnings must service borrowings before shareholders see anything.
🟡Profit is decliningFinancial
Net profit is down 20% over 3 years.
🟡Margins are compressingFinancial
EBITDA margin is down 3.5 points over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 36% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Cheaper than its peers
It trades 52% 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 23.4% to 19.9%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 2.96x. Interest is payable whether or not the business has a good year.
Returns on shareholder capital are falling
ROE has dropped from 22.3% to 11.5%. 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.
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

1EBITDA margin holds above 18%✓ 19.9%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹15 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.2x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 13%✓ 15.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 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

5 good · 3 neutral · 3 weak

Market Cap

₹69 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

8.0x

Cheap

Cheap against the generic band

P/B Ratio

0.74x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹17.07

Profitable

Profitable on a per-share basis

ROE

11.5%

Moderate

Moderate capital efficiency

ROCE

15.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

2.96x

High

High leverage

Revenue Growth (YoY)

-2.4%

Shrinking

Sales are contracting

Profit Growth (YoY)

-31.1%

Falling

Profits are shrinking

Dividend Yield

0.73%

Modest

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

Free Cash Flow

₹15 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

14.5%

Average

Average margins

Net Margin

11.7%

Good

Strong bottom-line conversion

Current Ratio

4.67

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.08

Defensive

Steadier than the market

52W Range Position

23%

Mid-range

Technical Snapshot

RSI (14)

30.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹77 Cr	₹79 Cr	₹77 Cr	₹74 Cr	-1.1%
EBITDA	₹18 Cr	₹14 Cr	₹15 Cr	₹15 Cr	-6.3%
EBITDA Margin	23.4%	17.7%	19.0%	19.9%	—
PAT (Net Profit)	₹12 Cr	₹9 Cr	₹9 Cr	₹9 Cr	-7.3%
EPS	₹23.58	₹18.28	₹18.35	₹18.8	-7.3%
ROE	22.3%	14.8%	13.0%	11.5%	—
ROCE	29.0%	19.6%	17.6%	15.7%	—
Total Debt	₹4 Cr	₹3 Cr	₹3 Cr	₹2 Cr	-13.8%
Free Cash Flow	₹10 Cr	₹8 Cr	₹4 Cr	₹15 Cr	+11.8%

🟡 Revenue has been broadly flat over 3 years (-1.1% a year).

🔴 EBITDA has shrunk at 6.3% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.4% to 19.9% over 3 years (-3.5 pts).

🔴 PAT (Net Profit) has shrunk at 7.3% a year over 3 years.

🔴 EPS has shrunk at 7.3% a year over 3 years.

🔴 ROE has fallen from 22.3% to 11.5% over 3 years (-10.8 pts).

🔴 ROCE has fallen from 29.0% to 15.7% over 3 years (-13.3 pts).

🟢 Total Debt has shrunk at 13.8% a year over 3 years.

🟢 Free Cash Flow has grown at 11.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹94 Cr

Total Liabilities

₹11 Cr

Cash & Equivalents

₹7 Cr

Operating Cash Flow

₹15 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

59.1%

Corporate Actions

Dividend Rate

₹1

Ex-Dividend Date

21 Sept 2026

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

6 general

CG-VAK Software & Exports Ltd

Equitypandit, 19 Aug

CG-VAK Software board to meet Oct 14 for committee reconstitution

scanx.trade, 05 Oct

CG-VAK Software & Exports Ltd. Peer Comparison – Compare with Others

Value Research, 03 Sept

CG-VAK Software & Exports Ltd. Share Price Live Today

CNBC TV18, 03 Jan

CG-VAK Software schedules 31st AGM on September 28, 2026

scanx.trade, 28 Sept

CG-VAK Software & Exports Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 02 Sept

Watch Items

Revenue growth is negative (-2.4%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability · Risk

WeakGrowth

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. 1 high-severity red flag sits above this conclusion and should be read first.

All 4 tripwires holding · see Key things to watch ↑