HyperSoft Technologies Limited

Technology — Information Technology Services · BSE

₹189.50−₹0.30 (−0.16%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

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, 6:10 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 HyperSoft Technologies Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

HyperSoft Technologies Limited provides information technology consulting, software development, digital transformation, cloud, data and artificial intelligence, cybersecurity, enterprise application, and managed services in India and internationally.

IndustryInformation Technology Services

SectorTechnology

Employees48

Annual revenue₹72 Cr

How does it make money?

Turns over ₹72 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹7 left at the operating level before interest, tax and depreciation. Each of its 48 employees supports ₹1.50 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin7.4%

Net margin5.7%

Revenue / employee₹1.50 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.

TATA CONSULTANCY SERV LTP/E 17.3x · ROE 45.6%

INFOSYS LIMITEDP/E 15.8x · ROE 32.0%

HCL TECHNOLOGIES LTDP/E 20.4x · ROE 24.6%

WIPRO LTDP/E 14.5x · ROE 15.9%

What is its competitive advantage?Little sign of one

Returns on capital of 2.4% 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.

ROCE2.4%

ROE1.9%

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 +8187% while net margin moved -144% 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+8187%

Margin effect-144%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

✓ Beta of -0.33 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

60/ 100

Average

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

Valuation

45/ 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

170.7x

1.3Y Median

273.5x

16 monthly readings · mean 272.6x · range 110.1x–436.7x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 38% below its 1.3y median of 273.5x. 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 932% above the peer median of 16.5x.

vs. its own history

Cheap

273.5x median over 16 months · -38%

vs. sector peers

Expensive

16.5x median of 4 peers · +932%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

170.7x

P/B

1.56x

EV/EBITDA

300.8x

PEG

—

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from -3.6% to 7.4% over 3 years.
Return on equity is rising
ROE has improved from -3.5% to 1.9%.
Return on capital is rising
ROCE has improved from -2.3% to 2.4%.
Valuation below its historical average
At 170.7x the stock trades 38% below its own median of 273.5x.

🔴 What Needs Attention2

Free cash flow is negative
The business is not currently covering its capital spending from operations.
Receivables growing faster than sales
Receivables are up 75829% against revenue growth of 8187% — customers are taking longer to pay.

Red Flags

4 items require attention · 2 high · 2 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.
🔴Receivables growing faster than salesFinancial
Receivables up 75829% against revenue up 8187% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹13 Cr in the latest year.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 1886% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -3.6% to 7.4%. 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 38% 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.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 75829% against revenue up 8187%. 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 932% above the peer median. That premium needs a reason that persists, or it closes.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
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

1Revenue growth stays above 252% a year✓ 336.0% CAGR
Latest reported year was 680.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 5%✓ 7.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹13 Cr
Profit that never becomes cash eventually stops being profit.
4ROCE stays above 8%✗ 2.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 273.5x✓ 170.7x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

3 / 10 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ 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

2 good · 4 neutral · 5 weak

Market Cap

₹1,600 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

170.7x

Expensive

Expensive — verify against sector peers

P/B Ratio

1.56x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹1.11

Profitable

Profitable on a per-share basis

ROE

1.9%

Weak

Weak capital efficiency

ROCE

2.4%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

680.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-38.8%

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

-₹13 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹189.5

Operating Margin

13.9%

Average

Average margins

Net Margin

9.6%

Average

Average bottom-line conversion

Current Ratio

1.22

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.33

Defensive

Steadier than the market

52W Range Position

77%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

185.3 / 194.1

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

43.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1 Cr	₹1 Cr	₹8 Cr	₹72 Cr	+336.0%
EBITDA	-₹0 Cr	-₹0 Cr	₹1 Cr	₹5 Cr	—
EBITDA Margin	-3.6%	-27.3%	6.8%	7.4%	—
PAT (Net Profit)	-₹0 Cr	-₹1 Cr	₹0 Cr	₹4 Cr	—
EPS	₹-0.26	₹-1.58	₹0.49	₹0.48	—
ROE	-3.5%	-30.2%	8.5%	1.9%	—
ROCE	-2.3%	-24.7%	19.6%	2.4%	—
Total Debt	₹0 Cr	₹0 Cr	—	—	—
Free Cash Flow	-₹0 Cr	-₹1 Cr	₹0 Cr	-₹13 Cr	—

🟢 Revenue has grown at 336.0% a year over 3 years.

🟢 EBITDA has turned positive, from -₹0 Cr to ₹5 Cr.

🟢 EBITDA Margin has risen from -3.6% to 7.4% over 3 years (+11.0 pts).

🟢 PAT (Net Profit) has turned positive, from -₹0 Cr to ₹4 Cr.

🟢 EPS has turned positive, from ₹-0.26 to ₹0.48.

🟢 ROE has risen from -3.5% to 1.9% over 3 years (+5.3 pts).

🟢 ROCE has risen from -2.3% to 2.4% over 3 years (+4.7 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹281 Cr

Total Liabilities

₹62 Cr

Total Debt

—

Cash & Equivalents

₹1 Cr

Operating Cash Flow

-₹13 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

97.1%

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

6 general

Hypersoft Technologies Ltd. Key Financial Ratios – Valuation, Profitability & More

Value Research, 13 Oct

Hypersoft Technologies Ltd. Upper Circuit Today: Price, Data and Peers

Univest, 25 Sept

Hypersoft Technologies Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 07 Oct

Hypersoft Technologies announces unified AI platform for data science and ERP

scanx.trade, 28 Sept

Hypersoft forays into AI domain with proprietary platform

Business Standard, 28 Sept

Hypersoft Technologies Ltd. Lower Circuit Streak: Day 2 Price and Data

Univest, 18 Sept

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
1 metric couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

🟡Business QualityAdequate10.2/20

🔴Financial HealthStretched8.2/20

🟢GrowthStrong18.4/20

🟡ProfitabilityModerate8.3/15

🟡ValuationFair8.3/15

🔴RiskHigh4/10

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.

This thesis breaks if

✓Revenue growth stays above 252% a year336.0% CAGR
✓EBITDA margin holds above 5%7.4%
✗Free cash flow remains positive-₹13 Cr
✗ROCE stays above 8%2.4%
✓Valuation vs its own median of 273.5x170.7x today