Cambridge Technology Enterprises Limited

Technology — Information Technology Services · NSE

₹37.40+₹1.23 (+3.40%)

DalalBaazaar Score

41 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by moderate debt load, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Whether sales start growing again is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

Cambridge Technology Enterprises Limited, a business and technology services company, provides IT solutions to enterprise services in India, the united states, the Middle East, Malaysia, the Philippines, and internationally.

IndustryInformation Technology Services

SectorTechnology

Employees279

Annual revenue₹181 Cr

How does it make money?

Turns over ₹181 Cr a year. Of every ₹100 of sales, about ₹0 reaches shareholders as profit, with ₹11 left at the operating level before interest, tax and depreciation. Each of its 279 employees supports ₹64.9 lakh of revenue a year, the signature of a people-led business.

EBITDA margin11.0%

Net margin0.3%

Revenue / employee₹64.9 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.

TATA CONSULTANCY SERV LTP/E 17.3x · ROE 45.6%

INFOSYS LIMITEDP/E 15.8x · ROE 32.0%

HCL TECHNOLOGIES LTDP/E 20.4x · ROE 24.6%

WIPRO LTDP/E 14.5x · ROE 15.9%

What is its competitive advantage?Little sign of one

Returns on capital of 5.6% 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.

ROCE5.6%

ROE0.6%

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 -1% while net margin moved -94% 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-1%

Margin effect-94%

DalalBaazaar Score

41/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 0.2% a year
✗ Profit has declined at 61.2% a year

Quality vs. Valuation

Company Quality

33/ 100

Weak

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

Valuation

88/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

Optically cheap, but the underlying business scores poorly. Cheap-and-weak is what a value trap looks like from the outside — the low price may be deserved.

Historical Valuation

Current P/E

10.5x

3Y Median

18.1x

40 monthly readings · mean 34.5x · range 7.7x–189.0x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 42% below its 3y median of 18.1x. 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 36% below the peer median of 16.5x.

vs. its own history

Cheap

18.1x median over 40 months · -42%

vs. sector peers

Cheap

16.5x median of 4 peers · -36%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

10.5x

P/B

0.91x

EV/EBITDA

7.0x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well2

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Valuation below its historical average
At 10.5x the stock trades 42% below its own median of 18.1x.

🔴 What Needs Attention3

Debt is rising
Total debt is up 42% over 3 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 8.2% to 0.6% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 8.9% to 5.6% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 2 high · 2 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.3x — little room if earnings dip.
🔴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.
🟡Debt is increasingFinancial
Total debt is up 42% over 3 years.
🟡Profit is decliningFinancial
Net profit is down 94% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 42% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 36% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 4.0x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 8.2% to 0.6%. 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.
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
2 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

1EBITDA margin holds above 9%✓ 11.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 4.0x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 1.3x
How much operating profit can fall before interest stops being comfortably covered.
4Free cash flow remains positive✓ ₹33 Cr
Profit that never becomes cash eventually stops being profit.
5ROCE stays above 8%✗ 5.6%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

5 / 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

₹72 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.5x

Cheap

Cheap against the generic band

P/B Ratio

0.91x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹3.55

Profitable

Profitable on a per-share basis

ROE

0.6%

Weak

Weak capital efficiency

ROCE

5.6%

Weak

Low return on total capital employed

Debt/Equity

1.01x

Moderate

Moderate leverage

Revenue Growth (YoY)

-3.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

1100.0%

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

₹33 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹37.4

Operating Margin

15.4%

Good

Healthy core-business profitability

Net Margin

3.9%

Average

Average bottom-line conversion

Current Ratio

2.31

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.89

Market-like

Moves roughly in line with the market

52W Range Position

43%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

39.6 / 41.3

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

28.1

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹182 Cr	₹206 Cr	₹199 Cr	₹181 Cr	-0.2%
EBITDA	₹21 Cr	₹24 Cr	-₹15 Cr	₹20 Cr	-1.3%
EBITDA Margin	11.4%	11.8%	-7.7%	11.0%	—
PAT (Net Profit)	₹8 Cr	₹6 Cr	-₹48 Cr	₹0 Cr	-61.2%
EPS	₹4.15	₹2.84	₹-24.8	₹0.24	-61.3%
ROE	8.2%	5.0%	-70.7%	0.6%	—
ROCE	8.9%	7.8%	-30.5%	5.6%	—
Total Debt	₹57 Cr	₹121 Cr	₹86 Cr	₹81 Cr	+12.4%
Free Cash Flow	-₹31 Cr	-₹25 Cr	₹19 Cr	₹33 Cr	—

🟡 Revenue has been broadly flat over 3 years (-0.2% a year).

🟡 EBITDA has been broadly flat over 3 years (-1.3% a year).

🟡 EBITDA Margin has held roughly flat at 11.0% over 3 years.

🔴 PAT (Net Profit) has shrunk at 61.2% a year over 3 years.

🔴 EPS has shrunk at 61.3% a year over 3 years.

🔴 ROE has fallen from 8.2% to 0.6% over 3 years (-7.7 pts).

🔴 ROCE has fallen from 8.9% to 5.6% over 3 years (-3.4 pts).

🔴 Total Debt has grown at 12.4% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹31 Cr to ₹33 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹185 Cr

Total Liabilities

₹105 Cr

Total Debt

₹81 Cr

Cash & Equivalents

₹13 Cr

Operating Cash Flow

₹36 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

67.6%

Corporate Actions

Ex-Dividend Date

16 Oct 2008

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 positive3 mixed2 general

Cambridge Technology Enterprises (NSE:CTE): Has It Filed the Reg 74(5) Depository Certificate for Q2 FY27?

Kalkine India, 16 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Cambridge Technology confirms AGM record date and register closure

scanx.trade, 08 Oct

Cambridge Technology Enterprises Share Price Target 2027, 2028 and 2030: Long Term Analyst Forecast

Univest, 07 AugAnalyst view

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

Cambridge Technology Enterprises consolidated net profit rises 1100.00% in the June 2026 quarter

Business Standard, 15 AugResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Cambridge Technology Enterprises Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

Cambridge Technology Raises Over HK$6.5 Billion via 8% Discounted Share Placement and Convertible Bonds; Stock Swings Before Turning Higher

BigGo Finance, 08 OctFunding

🟡Mixed / dependsNew funding changes the capital structure. Debt raises leverage; an equity raise dilutes existing holders.

Watch Items

Revenue growth is negative (-3.8%) 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.
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

🔴Business QualityWeak5.9/20

🟡Financial HealthAdequate11.6/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak4.6/15

🟢ValuationAttractive13.2/15

🔴RiskHigh3.6/10

Cheap, but for a reason

The low price is the whole case here, and the business underneath scores poorly. Cheap-and-weak is what a value trap looks like from the outside — it needs a specific reason the numbers are about to improve, not just the observation that they are low. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 9%11.0%
✗Debt / EBITDA falls below 3x4.0x
✗Interest cover stays above 3x1.3x
✓Free cash flow remains positive₹33 Cr
✗ROCE stays above 8%5.6%