Aditya Infotech Limited

Industrials — Building Products & Equipment · NSE

₹4,065.00−₹44.10 (−1.07%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by high debt relative to equity, negative free cash flow, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: Strong business and financial position, 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, 8:27 pm

Understanding the Business

Company site ↗

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

What does this company do?

Aditya Infotech Limited manufactures, assembles and trades security and surveillance equipment in India and internationally.

IndustryBuilding Products & Equipment

SectorIndustrials

Employees1,402

Annual revenue₹4,216 Cr

How does it make money?

Turns over ₹4,216 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹14 left at the operating level before interest, tax and depreciation. Each of its 1,402 employees supports ₹3.01 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.01 Cr

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. 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?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 25.9%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 19.6% against a peer median of 15.2% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE15.2%

What is the outlook?

6 analysts covering the stock expect revenue to grow about 30.1% and earnings to grow about 35.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+30.1%

Est. earnings growth+35.5%

Analysts6

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +85% while net margin moved +84% 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+85%

Margin effect+84%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 99.5x is demanding — it needs sustained high growth to justify
✗ P/E is 28% above its own historical median of 77.6x — expensive by its own standards
✗ P/B of 25.51x is a steep premium to book

Quality vs. Valuation

Company Quality

69/ 100

Good

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 good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

99.5x

1.3Y Median

77.6x

16 monthly readings · mean 80.5x · range 42.2x–126.8x

Sector Median

88.8x

median of 3 sector peers

⚠️Current valuation is approximately 28% above its 1.3y median of 77.6x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

🟡Against its sector it is priced broadly in line with the peer median of 88.8x.

vs. its own history

Expensive

77.6x median over 16 months · +28%

vs. sector peers

Fair

88.8x median of 3 peers · +12%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

85.7x

PEG

1.98

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 7.9% to 13.8% over 3 years.
Debt is being paid down
Total debt is down 58% over 3 years.
High return on capital employed
ROCE of 25.9% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 34.8% to 19.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 44.2% to 25.9% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 2 high · 3 watch

🔴High leverageFinancial
Debt/Equity of 9.60x — 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.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹123 Cr in the latest year.
🟡Receivables growing faster than salesFinancial
Receivables up 128% against revenue up 85% — sales are being booked faster than they are collected.
🟡Inventory building faster than salesFinancial
Inventory up 116% against revenue up 85% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 25.9% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 7.9% to 13.8%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 58% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
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?

Leverage amplifies any setback
Debt/Equity of 9.60x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 128% against revenue up 85%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 28% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 34.8% to 19.6%. 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.
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.

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

1Revenue growth stays above 17% a year✓ 22.7% CAGR
Latest reported year was 89.5%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 12%✓ 13.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹123 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 23%✓ 25.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 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

5 good · 2 neutral · 4 weak

Market Cap

₹49,848 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

99.5x

Expensive

Expensive — verify against sector peers

P/B Ratio

25.51x

Rich

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

EPS (TTM)

₹40.86

Profitable

Profitable on a per-share basis

ROE

19.6%

Strong

Strong capital efficiency

ROCE

25.9%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

9.60x

High

High leverage

Revenue Growth (YoY)

89.5%

Healthy

Healthy top-line growth

Profit Growth (YoY)

303.7%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.04%

Modest

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

Free Cash Flow

-₹123 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

53.7x

Improving

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

Operating Margin

13.6%

Average

Average margins

Net Margin

9.8%

Average

Average bottom-line conversion

Current Ratio

1.53

Comfortable

Healthy short-term liquidity

52W Range Position

83%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

3915.2 / 3737.7

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

62.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,284 Cr	₹2,782 Cr	₹3,111 Cr	₹4,216 Cr	+22.7%
EBITDA	₹180 Cr	₹206 Cr	₹258 Cr	₹582 Cr	+47.7%
EBITDA Margin	7.9%	7.4%	8.3%	13.8%	—
PAT (Net Profit)	₹108 Cr	₹115 Cr	₹351 Cr	₹368 Cr	+50.3%
EPS	₹9.24	₹9.83	₹29.97	₹32.05	+51.4%
ROE	34.8%	27.1%	34.5%	19.6%	—
ROCE	44.2%	40.6%	43.9%	25.9%	—
Total Debt	₹427 Cr	₹436 Cr	₹457 Cr	₹180 Cr	-25.0%
Free Cash Flow	₹49 Cr	-₹199 Cr	₹1 Cr	-₹123 Cr	—

🟢 Revenue has grown at 22.7% a year over 3 years.

🟢 EBITDA has grown at 47.7% a year over 3 years.

🟢 EBITDA Margin has risen from 7.9% to 13.8% over 3 years (+5.9 pts).

🟢 PAT (Net Profit) has grown at 50.3% a year over 3 years.

🟢 EPS has grown at 51.4% a year over 3 years.

🔴 ROE has fallen from 34.8% to 19.6% over 3 years (-15.2 pts).

🔴 ROCE has fallen from 44.2% to 25.9% over 3 years (-18.3 pts).

🟢 Total Debt has shrunk at 25.0% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹49 Cr to -₹123 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,991 Cr

Total Liabilities

₹2,114 Cr

Cash & Equivalents

₹165 Cr

Operating Cash Flow

₹13 Cr

Capex

-₹136 Cr

Shareholding (proxy)

Institutional Holding

16.7%

Insider Holding

76.8%

Corporate Actions

Dividend Rate

₹1.64

Ex-Dividend Date

20 Jul 2026

Analyst Consensus

Recommendations

6 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹4,109.67

+1.1% vs CMP

Target Range

₹3,100 – ₹4,878

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

1 positive1 mixed4 general

Aditya Infotech (NSEI:CPPLUS) Stock Forecast & Analyst Predictions

Simply Wall Street, 14 OctAnalyst view

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

Aditya Infotech Dividend 2026: ₹1.64, Record Date 20 Jul

INDmoney, 14 OctCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Mutual funds' portfolio shifts: Aditya Infotech, BSE stand out among top 10 stocks by holding value changes in September

TradingView, 18 Oct

Mutual funds’ portfolio shifts: Aditya Infotech, BSE stand out among top 10 stocks by holding value changes in September

Livemint, 18 Oct

Stock to buy today: Aditya Infotech (₹3,989.05) – BUY

BusinessLine, 15 Oct

Compare with

Equitymaster, 18 Oct

Watch Items

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

DalalBaazaar Thesis

StrongGrowth

MiddlingBusiness Quality · Financial Health · Profitability

WeakValuation · Risk

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you. 2 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 ↑