Digitide Solutions Limited

Industrials — Specialty Business Services · NSE

₹73.50+₹0.08 (+0.11%)

DalalBaazaar Score

29 / 100

🔴 Weak

Verdict

HIGH RISK

Risk

High

Driven by the company is currently loss-making, micro-cap size, which brings thin liquidity, falling profits.

In simple words: The company is currently losing money, though profits are falling even as sales grow. The direction of profits 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 Digitide Solutions Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Digitide Solutions Limited engages in business process management services and technology.

IndustrySpecialty Business Services

SectorIndustrials

Employees53,500

Annual revenue₹3,080 Cr

How does it make money?

Turns over ₹3,080 Cr a year. Of every ₹100 of sales, about ₹-1 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 53,500 employees supports ₹5.8 lakh of revenue a year, the signature of a people-led business.

EBITDA margin11.5%

Net margin-0.5%

Revenue / employee₹5.8 lakh

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.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

What is its competitive advantage?Little sign of one

Returns on capital of 5.9% 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.

ROCE5.9%

ROE-2.0%

Peer median ROE15.2%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 1 years revenue moved -6% while net margin moved -115% 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-6%

Margin effect-115%

DalalBaazaar Score

29/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 5.8% a year
✗ Profit fell 114.1% in the latest year

Quality vs. Valuation

Company Quality

27/ 100

Weak

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

Valuation

54/ 100

Fair

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

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

P/E (Trailing)

Not meaningful

P/B

1.31x

EV/EBITDA

4.0x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well0

Nothing stands out as clearly improving on the years of data available.

🔴 What Needs Attention4

Margins are compressing
EBITDA margin has slipped from 14.9% to 11.5% over 1 years.
Debt is rising
Total debt is up 50% over 1 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 13.9% to -2.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 21.2% to 5.9% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 2 high · 3 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 1.6x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹16 Cr in the latest reported year.
🟡Debt is increasingFinancial
Total debt is up 50% over 1 years.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 5.0x to 1.6x.
🟡Margins are compressingFinancial
EBITDA margin is down 3.3 points over 1 years.

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 14.9% to 11.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Returns on shareholder capital are falling
ROE has dropped from 13.9% to -2.0%. 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.
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 10%✓ 11.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Interest cover stays above 3x✗ 1.6x
How much operating profit can fall before interest stops being comfortably covered.
3Free cash flow remains positive✓ ₹157 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ 5.9%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 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

3 good · 3 neutral · 5 weak

Market Cap

₹1,096 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

1.31x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹-1.61

Loss-making

Negative earnings per share — the business is losing money

ROE

-2.0%

Weak

Weak capital efficiency

ROCE

5.9%

Weak

Low return on total capital employed

Debt/Equity

0.58x

Low

Conservative leverage

Revenue Growth (YoY)

5.3%

Modest

Modest growth

Profit Growth (YoY)

-114.1%

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

₹157 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹73.5

Operating Margin

2.8%

Weak

Thin margins leave little room for error

Net Margin

-0.8%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.47

Comfortable

Healthy short-term liquidity

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

75.6 / 88.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

37.3

Neutral momentum

Financial Trend (2-Year)

Metric	FY25	FY26	1Y CAGR
Revenue	₹3,269 Cr	₹3,080 Cr	-5.8%
EBITDA	₹485 Cr	₹355 Cr	-26.9%
EBITDA Margin	14.9%	11.5%	—
PAT (Net Profit)	₹116 Cr	-₹16 Cr	—
EPS	₹7.76	₹-1.1	—
ROE	13.9%	-2.0%	—
ROCE	21.2%	5.9%	—
Total Debt	₹354 Cr	₹531 Cr	+50.0%
Free Cash Flow	₹289 Cr	₹157 Cr	-45.6%

🔴 Revenue has shrunk at 5.8% a year over 1 years.

🔴 EBITDA has shrunk at 26.9% a year over 1 years.

🔴 EBITDA Margin has fallen from 14.9% to 11.5% over 1 years (-3.3 pts).

🔴 PAT (Net Profit) has turned negative, from ₹116 Cr to -₹16 Cr.

🔴 EPS has turned negative, from ₹7.76 to ₹-1.1.

🔴 ROE has fallen from 13.9% to -2.0% over 1 years (-15.8 pts).

🔴 ROCE has fallen from 21.2% to 5.9% over 1 years (-15.3 pts).

🔴 Total Debt has grown at 50.0% a year over 1 years.

🔴 Free Cash Flow has shrunk at 45.6% a year over 1 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,036 Cr

Total Liabilities

₹1,120 Cr

Total Debt

₹531 Cr

Cash & Equivalents

₹193 Cr

Operating Cash Flow

₹263 Cr

Capex

-₹105 Cr

Shareholding (proxy)

Institutional Holding

14.7%

Insider Holding

63.7%

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 mixed5 general

DIGITIDE Share Price News: Price Action and Fundamentals

Univest, 13 Oct

DIGITIDE Stock Price and Chart — NSE:DIGITIDE

TradingView, 14 Jul

Digitide Solutions Launches Pulse.nerve Enterprise AI Orchestration Platform with 100+ Specialized Agents

scanx.trade, 14 Oct

Digitide Solutions Ltd leads losers in 'B' group

Business Standard, 07 Jul

Digitide Solutions - FIIs keep cutting stakes in 14 smallcap stocks as shares crash up to 65% in 3 months

The Economic Times, 06 AprPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Digitide Solutions (DIGITIDE.NS) Steadies at ₹72.87, Consolidating Between ₹69.23 and ₹76.51 - IPO Entry Watch

siam.in, 02 Oct

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🔴Business QualityWeak4.7/20

🟡Financial HealthAdequate10.7/20

🔴GrowthWeak2.4/20

🔴ProfitabilityWeak2.5/15

🟡ValuationFair7.1/15

🔴RiskHigh1.8/10

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 2 high-severity red flags sit above this conclusion and should be read first.

This thesis breaks if

✓EBITDA margin holds above 10%11.5%
✗Interest cover stays above 3x1.6x
✓Free cash flow remains positive₹157 Cr
✓Debt / EBITDA stays below 2x1.5x
✗ROCE stays above 8%5.9%