Digidrive Distributors Limited

Consumer Cyclical — Internet Retail · NSE

₹19.49+₹0.61 (+3.23%)

DalalBaazaar Score

56 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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, 7:00 pm

Understanding the Business

Company site ↗

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

What does this company do?

Digidrive Distributors Limited distributes retail goods through digital marketplaces in India. It operates through Trading and Publication segments.

IndustryInternet Retail

SectorConsumer Cyclical

Employees8

Annual revenue₹46 Cr

How does it make money?

Turns over ₹46 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 8 employees supports ₹5.77 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹5.77 Cr

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS 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?Little sign of one

Returns on capital of 2.5% 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 ROE25.9%

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +7% while net margin moved +8% 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+7%

Margin effect+8%

DalalBaazaar Score

56/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 2.4% — barely ahead of inflation
✗ Profit CAGR of only 5.0%
✗ Profit fell 32.0% in the latest year

Quality vs. Valuation

Company Quality

52/ 100

Average

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

Valuation

73/ 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

13.5x

3Y Median

28.1x

35 monthly readings · mean 24.8x · range 8.2x–51.1x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 52% below its 3y median of 28.1x. 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 80% below the peer median of 69.2x.

vs. its own history

Cheap

28.1x median over 35 months · -52%

vs. sector peers

Cheap

69.2x median of 4 peers · -80%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

8.7x

PEG

2.71

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 15.9% to 18.1% over 3 years.
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

3 items require attention · 1 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 99% over 3 years, from ₹0 Cr to ₹1 Cr.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹5 Cr in the latest year.
🟡Inventory building faster than salesFinancial
Inventory up 33% against revenue up 7% — stock may not be moving.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 15.9% to 18.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 52% 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 80% 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?

Growth barely outpaces inflation
Revenue compounding at 2.4% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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 16%✓ 18.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹5 Cr
Profit that never becomes cash eventually stops being profit.
3Revenue growth stays above 4% a year✗ 2.4% CAGR
Latest reported year was 6.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
4Debt / EBITDA stays below 2x✓ 0.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ 2.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 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

4 good · 3 neutral · 4 weak

Market Cap

₹75 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

13.5x

Cheap

Cheap against the generic band

P/B Ratio

0.28x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹1.44

Profitable

Profitable on a per-share basis

ROE

2.0%

Weak

Weak capital efficiency

ROCE

2.5%

Weak

Low return on total capital employed

Debt/Equity

0.32x

Low

Conservative leverage

Revenue Growth (YoY)

6.8%

Modest

Modest growth

Profit Growth (YoY)

-32.0%

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

-₹5 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

1.2%

Weak

Thin margins leave little room for error

Net Margin

12.3%

Good

Strong bottom-line conversion

Current Ratio

4.68

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.78

Defensive

Steadier than the market

52W Range Position

22%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

18.1 / 17.8

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

62.2

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹43 Cr	₹48 Cr	₹50 Cr	₹46 Cr	+2.4%
EBITDA	₹7 Cr	₹6 Cr	₹10 Cr	₹8 Cr	+7.1%
EBITDA Margin	15.9%	12.9%	20.0%	18.1%	—
PAT (Net Profit)	₹5 Cr	₹4 Cr	₹8 Cr	₹5 Cr	+5.0%
EPS	₹1.21	₹1.05	₹2.05	₹1.4	+5.1%
ROE	3.4%	1.8%	2.9%	2.0%	—
ROCE	4.4%	2.3%	3.2%	2.5%	—
Total Debt	₹0 Cr	₹0 Cr	₹1 Cr	₹1 Cr	+25.8%
Free Cash Flow	-₹9 Cr	₹8 Cr	-₹8 Cr	-₹5 Cr	—

🟢 Revenue has grown at 2.4% a year over 3 years.

🟢 EBITDA has grown at 7.1% a year over 3 years.

🟢 EBITDA Margin has risen from 15.9% to 18.1% over 3 years (+2.3 pts).

🟢 PAT (Net Profit) has grown at 5.0% a year over 3 years.

🟢 EPS has grown at 5.1% a year over 3 years.

🔴 ROE has fallen from 3.4% to 2.0% over 3 years (-1.4 pts).

🔴 ROCE has fallen from 4.4% to 2.5% over 3 years (-1.9 pts).

🔴 Total Debt has grown at 25.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹309 Cr

Total Liabilities

₹37 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

-₹4 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

61.9%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

1 mixed5 general

Digidrive Distributors: Profit Relies on Other Income, Stock Below Book

Kalkine India, 12 Oct

Compare with

Equitymaster, 14 Oct

Digidrive Distributors Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 01 Sept

Digidrive shares held free of encumbrance in FY26

scanx.trade, 17 Jun

Digidrive Distributors Share Price Target 2026: Rs 22.8 Analyst Forecast

Univest, 23 JunAnalyst view

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

Digidrive Distributors confirms no encumbrance on PCBL Chemical shares

scanx.trade, 12 Jun

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability

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

3 of 5 tripwires tripped — Free cash flow remains positive; Revenue growth stays above 4% a year; ROCE stays above 8% · see Key things to watch ↑