eClerx Services Limited

Technology — Information Technology Services · NSE

₹1,951.10−₹47.10 (−2.36%)

DalalBaazaar Score

74 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 8:28 pm

Understanding the Business

Company site ↗

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

What does this company do?

eClerx Services Limited provides business process management, change management, data-driven insights, and advanced analytics services in North America, the United Kingdom, rest of Europe, and the Asia Pacific.

IndustryInformation Technology Services

SectorTechnology

Employees12,641

Annual revenue₹4,117 Cr

How does it make money?

Turns over ₹4,117 Cr a year. Of every ₹100 of sales, about ₹17 reaches shareholders as profit, with ₹28 left at the operating level before interest, tax and depreciation. Each of its 12,641 employees supports ₹32.6 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹32.6 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?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 32.7%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 27.6% against a peer median of 32.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE32.0%

What is the outlook?

10 analysts covering the stock expect revenue to grow about 14.1% and earnings to grow about 18.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+14.1%

Est. earnings growth+18.5%

Analysts10

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +55% while net margin moved -7% 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+55%

Margin effect-7%

DalalBaazaar Score

74/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 25.5x already prices in growth
• P/E is close to its own historical median of 27.1x
✗ P/B of 7.05x is a steep premium to book

Quality vs. Valuation

Company Quality

82/ 100

Excellent

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

Valuation

42/ 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

25.5x

3Y Median

27.1x

40 monthly readings · mean 28.8x · range 16.7x–42.2x

Sector Median

16.5x

median of 4 sector peers

🟡Currently trading close to its 3y median of 27.1x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 54% above the peer median of 16.5x.

vs. its own history

Fair

27.1x median over 40 months · -6%

vs. sector peers

Expensive

16.5x median of 4 peers · +54%

vs. generic bands

Fair

15x–35x

EV/EBITDA

15.5x

PEG

1.95

What's Good / What's Bad

🟢 What's Going Well4

Cash generation is improving
Free cash flow is up 88% over 3 years.
High return on capital employed
ROCE of 32.7% is the mark of a business that converts capital into profit efficiently.
Very low debt
Debt/Equity of 0.15x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on capital is falling
ROCE has declined from 34.8% to 32.7% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 high

🔴Debt has risen sharplyFinancial
Total debt is up 99% over 3 years, from ₹194 Cr to ₹385 Cr.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 32.7% 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.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹754 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

A premium to the sector to defend
It trades 54% above the peer median. That premium needs a reason that persists, or it closes.
Size brings its own risk
Small 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

1Revenue growth stays above 12% a year✓ 15.8% CAGR
Latest reported year was 23.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 26%✓ 27.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹754 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 30%✓ 32.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

12 / 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

7 good · 3 neutral · 1 weak

Market Cap

₹17,955 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

25.5x

Fair

Fairly valued against the generic band

P/B Ratio

7.05x

Rich

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

EPS (TTM)

₹76.6

Profitable

Profitable on a per-share basis

ROE

27.6%

Strong

Strong capital efficiency

ROCE

32.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.15x

Low

Conservative leverage

Revenue Growth (YoY)

23.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

18.8%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.05%

Modest

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

Free Cash Flow

₹754 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

19.9x

Improving

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

Operating Margin

18.7%

Good

Healthy core-business profitability

Net Margin

16.8%

Good

Strong bottom-line conversion

Current Ratio

3.40

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.40

Defensive

Steadier than the market

52W Range Position

54%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1893.7 / 1889.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

55.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,649 Cr	₹2,926 Cr	₹3,366 Cr	₹4,117 Cr	+15.8%
EBITDA	₹768 Cr	₹863 Cr	₹878 Cr	₹1,141 Cr	+14.1%
EBITDA Margin	29.0%	29.5%	26.1%	27.7%	—
PAT (Net Profit)	₹489 Cr	₹511 Cr	₹541 Cr	₹706 Cr	+13.0%
EPS	₹48.58	₹52.19	₹56.04	₹74.42	+15.3%
ROE	28.5%	22.8%	23.5%	27.6%	—
ROCE	34.8%	27.9%	27.9%	32.7%	—
Total Debt	₹194 Cr	₹266 Cr	₹358 Cr	₹385 Cr	+25.8%
Free Cash Flow	₹402 Cr	₹459 Cr	₹533 Cr	₹754 Cr	+23.4%

🟢 Revenue has grown at 15.8% a year over 3 years.

🟢 EBITDA has grown at 14.1% a year over 3 years.

🔴 EBITDA Margin has fallen from 29.0% to 27.7% over 3 years (-1.3 pts).

🟢 PAT (Net Profit) has grown at 13.0% a year over 3 years.

🟢 EPS has grown at 15.3% a year over 3 years.

🟡 ROE has held roughly flat at 27.6% over 3 years.

🔴 ROCE has fallen from 34.8% to 32.7% over 3 years (-2.1 pts).

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

🟢 Free Cash Flow has grown at 23.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,697 Cr

Total Liabilities

₹1,133 Cr

Cash & Equivalents

₹697 Cr

Operating Cash Flow

₹873 Cr

Capex

-₹119 Cr

Shareholding (proxy)

Institutional Holding

32.7%

Insider Holding

58.4%

Corporate Actions

Dividend Rate

₹1

Ex-Dividend Date

21 Aug 2026

Analyst Consensus

Recommendations

6 Buy · 2 Hold · 2 Sell

Target Price (Mean)

₹1,979.5

+1.5% vs CMP

Target Range

₹1,520 – ₹2,370

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

4 mixed2 general

eClerx Services (NSEI:ECLERX) Stock Forecast & Analyst Predictions

Simply Wall Street, 05 OctAnalyst view

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

ECLERX Forecast — Price Target — Prediction for 2027

TradingView, 26 JunAnalyst view

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

eClerx Services among 4 stocks that closed crossing above VWAP

The Economic Times, 14 Oct

eClerx Services Share Price live: price action analysis

Univest, 05 Oct

eClerx Services Reports Q1 Revenue Of 11.5B Rupees, Net Profit At 1.64B Rupees

Sahi, 05 AugResults

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

Naukri, Zensar Technologies and Eclerx Services share price soars over 20% in July; here is why

Upstox, 14 JulPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Watch Items

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

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability · Risk

WeakValuation

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

All 5 tripwires holding · see Key things to watch ↑