Expleo Solutions Limited

Technology — Information Technology Services · NSE

₹885.50+₹18.65 (+2.15%)

DalalBaazaar Score

61 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

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

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

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:52 pm

Understanding the Business

Company site ↗

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

What does this company do?

Expleo Solutions Limited, together with its subsidiaries, primarily provides software validation and verification services to the banking, financial services, and insurance industries worldwide.

IndustryInformation Technology Services

SectorTechnology

Employees3,968

Annual revenue₹1,108 Cr

How does it make money?

Turns over ₹1,108 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 3,968 employees supports ₹27.9 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹27.9 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.

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 20.6%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 16.0% 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?

1 analysts covering the stock expect revenue to grow about 17.9% and earnings to grow about 23.7% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+17.9%

Est. earnings growth+23.7%

Analysts1

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +23% while net margin moved -25% 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+23%

Margin effect-25%

DalalBaazaar Score

61/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 7.0% — barely ahead of inflation
✗ Profit has declined at 2.5% a year
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows

Quality vs. Valuation

Company Quality

58/ 100

Average

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

Valuation

84/ 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

10.0x

3Y Median

15.2x

40 monthly readings · mean 15.6x · range 9.7x–24.1x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 34% below its 3y median of 15.2x. 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 40% below the peer median of 16.5x.

vs. its own history

Cheap

15.2x median over 40 months · -34%

vs. sector peers

Cheap

16.5x median of 4 peers · -40%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

5.1x

PEG

—

What's Good / What's Bad

🟢 What's Going Well4

Debt is being paid down
Total debt is down 70% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
High return on capital employed
ROCE of 20.6% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 25.3% to 16.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 33.5% to 20.6% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴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.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 5.6 points, from 23.9% to 18.3%.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 51% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 20.6% 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.
Deleveraging frees up earnings
Debt is down 70% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Priced below its own history
The stock trades 34% 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 40% 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?

Margins are being competed away
EBITDA margin has fallen from 23.9% to 18.3%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Growth barely outpaces inflation
Revenue compounding at 7.0% 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.
Returns on shareholder capital are falling
ROE has dropped from 25.3% to 16.0%. 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 16%✓ 18.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 5% a year✓ 7.0% CAGR
Latest reported year was 12.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹117 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 18%✓ 20.6%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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

8 good · 3 neutral · 0 weak

Market Cap

₹1,374 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.0x

Cheap

Cheap against the generic band

P/B Ratio

1.77x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹88.75

Profitable

Profitable on a per-share basis

ROE

16.0%

Strong

Strong capital efficiency

ROCE

20.6%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.01x

Moderate

Moderate leverage

Revenue Growth (YoY)

12.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

67.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

12.42%

Healthy

Meaningful cash return while you hold the stock

Free Cash Flow

₹117 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

7.6x

Improving

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

Operating Margin

13.2%

Average

Average margins

Net Margin

12.1%

Good

Strong bottom-line conversion

Current Ratio

5.55

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.42

Defensive

Steadier than the market

52W Range Position

46%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

870.6 / 870.7

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

54.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹903 Cr	₹965 Cr	₹1,025 Cr	₹1,108 Cr	+7.0%
EBITDA	₹216 Cr	₹156 Cr	₹179 Cr	₹203 Cr	-2.1%
EBITDA Margin	23.9%	16.2%	17.5%	18.3%	—
PAT (Net Profit)	₹134 Cr	₹90 Cr	₹103 Cr	₹124 Cr	-2.5%
EPS	₹86.27	₹58.27	₹66.52	₹79.89	-2.5%
ROE	25.3%	14.8%	16.2%	16.0%	—
ROCE	33.5%	18.5%	20.8%	20.6%	—
Total Debt	₹26 Cr	₹26 Cr	₹30 Cr	₹8 Cr	-33.1%
Free Cash Flow	-₹21 Cr	₹54 Cr	₹172 Cr	₹117 Cr	—

🟢 Revenue has grown at 7.0% a year over 3 years.

🔴 EBITDA has shrunk at 2.1% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.9% to 18.3% over 3 years (-5.6 pts).

🔴 PAT (Net Profit) has shrunk at 2.5% a year over 3 years.

🔴 EPS has shrunk at 2.5% a year over 3 years.

🔴 ROE has fallen from 25.3% to 16.0% over 3 years (-9.3 pts).

🔴 ROCE has fallen from 33.5% to 20.6% over 3 years (-12.9 pts).

🟢 Total Debt has shrunk at 33.1% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹21 Cr to ₹117 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹929 Cr

Total Liabilities

₹153 Cr

Cash & Equivalents

₹354 Cr

Operating Cash Flow

₹119 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.1%

Insider Holding

71.0%

Corporate Actions

Dividend Rate

₹110

Ex-Dividend Date

31 Jul 2026

Analyst Consensus

Recommendations

1 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,140

+28.7% vs CMP

Target Range

₹1,140 – ₹1,140

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

2 positive1 mixed1 negative2 general

Expleo Solutions Board Suggests Final Dividend Of ₹110 Per Share

Sahi, 28 JulCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Expleo Solution Shares Soar 14.35% in Previous Session as Company Declares ₹110 Final Dividend; Ex-Date...

Moneycontrol.com, 30 JulCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Expleo Solutions discloses promoter group pledge agreements

scanx.trade, 13 JunOwnership

🔴Potentially negativePromoter selling or pledging is a signal worth understanding, though the reason is often personal rather than about the business.

Expleo Solutions (NSEI:EXPLEOSOL) Stock Forecast & Analyst Predictions

Simply Wall Street, 17 AugAnalyst view

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

Volume Gainers, August 17, 2026, 3:30 PM IST

HDFC Sky, 17 Aug

Expleo Solutions Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 30 Aug

Watch Items

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

DalalBaazaar Thesis

StrongFinancial Health · Valuation

MiddlingBusiness Quality · Profitability · Risk

WeakGrowth

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. 2 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑