Exato Technologies Limited

Technology — Information Technology Services · BSE

₹688.00+₹29.30 (+4.45%)

DalalBaazaar Score

64 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently 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 Exato Technologies Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Exato Technologies Limited provides Customer Experience-as-a-Service (CXaaS) and AI-as-a-Service platforms in India and internationally.

IndustryInformation Technology Services

SectorTechnology

Employees135

Annual revenue₹168 Cr

How does it make money?

Turns over ₹168 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹15 left at the operating level before interest, tax and depreciation. Each of its 135 employees supports ₹1.24 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.24 Cr

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 26.8%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 18.2% 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 has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +131% while net margin moved +38% 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+131%

Margin effect+38%

DalalBaazaar Score

64/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

74/ 100

Good

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

Valuation

47/ 100

Fair

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

34.8x

1.0Y Median

36.9x

12 monthly readings · mean 38.2x · range 31.7x–61.4x

Sector Median

16.5x

median of 4 sector peers

🟡Currently trading close to its 1.0y median of 36.9x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 110% above the peer median of 16.5x.

vs. its own history

Fair

36.9x median over 12 months · -6%

vs. sector peers

Expensive

16.5x median of 4 peers · +110%

vs. generic bands

Fair

15x–35x

EV/EBITDA

27.5x

PEG

0.74

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 8.5% to 15.0% over 3 years.
High return on capital employed
ROCE of 26.8% is the mark of a business that converts capital into profit efficiently.
Very low debt
Debt/Equity of 0.24x 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 equity is falling
ROE has dropped from 23.3% to 18.2% — each rupee of shareholder capital earns less than it did.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 239% over 3 years, from ₹6 Cr to ₹21 Cr.
🔴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.
🔴Receivables growing faster than salesFinancial
Receivables up 443% against revenue up 131% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹12 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 26.8% 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 8.5% to 15.0%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
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?

Sales are being booked faster than collected
Receivables are up 443% against revenue up 131%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 110% above the peer median. That premium needs a reason that persists, or it closes.
Returns on shareholder capital are falling
ROE has dropped from 23.3% to 18.2%. 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
3 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

1Revenue growth stays above 24% a year✓ 32.2% CAGR
Latest reported year was 50.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 13%✓ 15.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹12 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.8x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 24%✓ 26.8%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 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

6 good · 3 neutral · 2 weak

Market Cap

₹692 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

34.8x

Fair

Fairly valued against the generic band

P/B Ratio

7.85x

Rich

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

EPS (TTM)

₹19.76

Profitable

Profitable on a per-share basis

ROE

18.2%

Strong

Strong capital efficiency

ROCE

26.8%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.24x

Low

Conservative leverage

Revenue Growth (YoY)

50.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

55.0%

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

-₹12 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

17.7%

Good

Healthy core-business profitability

Net Margin

10.4%

Good

Strong bottom-line conversion

Current Ratio

2.76

Comfortable

Healthy short-term liquidity

52W Range Position

81%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

678.1 / 692.5

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

51.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹73 Cr	₹114 Cr	₹124 Cr	₹168 Cr	+32.2%
EBITDA	₹6 Cr	₹9 Cr	₹16 Cr	₹25 Cr	+60.1%
EBITDA Margin	8.5%	8.0%	12.7%	15.0%	—
PAT (Net Profit)	₹5 Cr	₹5 Cr	₹10 Cr	₹16 Cr	+47.1%
EPS	₹5.02	₹5.27	₹9.59	₹19.1	+56.1%
ROE	23.3%	19.6%	22.8%	18.2%	—
ROCE	25.6%	28.8%	29.6%	26.8%	—
Total Debt	₹6 Cr	₹17 Cr	₹32 Cr	₹21 Cr	+50.2%
Free Cash Flow	₹10 Cr	-₹20 Cr	₹1 Cr	-₹12 Cr	—

🟢 Revenue has grown at 32.2% a year over 3 years.

🟢 EBITDA has grown at 60.1% a year over 3 years.

🟢 EBITDA Margin has risen from 8.5% to 15.0% over 3 years (+6.6 pts).

🟢 PAT (Net Profit) has grown at 47.1% a year over 3 years.

🟢 EPS has grown at 56.1% a year over 3 years.

🔴 ROE has fallen from 23.3% to 18.2% over 3 years (-5.1 pts).

🟢 ROCE has risen from 25.6% to 26.8% over 3 years (+1.2 pts).

🔴 Total Debt has grown at 50.2% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹10 Cr to -₹12 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹123 Cr

Total Liabilities

₹35 Cr

Cash & Equivalents

₹20 Cr

Operating Cash Flow

₹2 Cr

Capex

-₹13 Cr

Shareholding (proxy)

Institutional Holding

1.6%

Insider Holding

79.0%

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 mixed5 general

Exato Technologies Upper Circuit Today: Price, Data and Peers

Univest, 05 Oct

Vijay Kedia portfolio SME stock Exato Technologies zooms 66% in 3 days

Business Standard, 13 Jul

Vijay Kedia buys 3.58 lakh shares in this IT company that nearly doubled investor money

The Economic Times, 12 Jul

Exato Technologies certified as partner in Claude Partner Network

scanx.trade, 02 Oct

EXATO TECHNOLOGIES LIMITED Share Price

Upstox, 05 May

Vijay Kedia Acquires Additional 3.56% Stake In This Low-Debt Small-Cap IT Services Company; Shares Jump 14%

Dalal Street Investment Journal, 10 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

MiddlingProfitability

WeakValuation · Risk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 3 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 ↑