ideaForge Technology Limited

Technology — Computer Hardware · NSE

₹730.55+₹9.85 (+1.37%)

DalalBaazaar Score

41 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a beta above 1.3, so it swings harder than the index.

In simple words: The business is earning a fairly low return on the money invested in it, 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, 7:44 pm

Understanding the Business

Company site ↗

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

What does this company do?

ideaForge Technology Limited engages in the manufacture and marketing of unmanned aerial vehicle (UAV) systems for security and surveillance applications in India and internationally.

IndustryComputer Hardware

SectorTechnology

Annual revenue₹226 Cr

How does it make money?

Turns over ₹226 Cr a year. Of every ₹100 of sales, about ₹-8 reaches shareholders as profit, with ₹6 left at the operating level before interest, tax and depreciation.

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?Little sign of one

Returns on capital of -2.6% 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.

Peer median ROE32.0%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 59.9% and earnings to grow about 198.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+59.9%

Est. earnings growth+198.5%

Analysts2

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +34% while net margin moved -140% 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+34%

Margin effect-140%

DalalBaazaar Score

41/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 93.1x is demanding — it needs sustained high growth to justify
✗ P/E is 39% above its own historical median of 66.9x — expensive by its own standards
✗ P/B of 5.28x is a steep premium to book

Quality vs. Valuation

Company Quality

47/ 100

Average

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

Valuation

23/ 100

Expensive

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

93.1x

3Y Median

66.9x

40 monthly readings · mean 67.9x · range 32.1x–129.1x

Sector Median

16.5x

median of 4 sector peers

⚠️Current valuation is approximately 39% above its 3y median of 66.9x. Paying more than usual needs a reason — faster growth, a better balance sheet, or a re-rating you believe in.

⚠️Against its sector it trades 462% above the peer median of 16.5x.

vs. its own history

Expensive

66.9x median over 40 months · +39%

vs. sector peers

Expensive

16.5x median of 4 peers · +462%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

257.2x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Debt is being paid down
Total debt is down 17% over 3 years.
Very low debt
Debt/Equity of 0.14x leaves the balance sheet with plenty of headroom.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 9.9% to -2.8% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 13.4% to -2.6% — often a sign of competition or overexpansion.

Red Flags

5 items require attention · 4 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only -4.2x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹17 Cr in the latest reported year.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 26.4 points, from 32.8% to 6.3%.
🔴Receivables growing faster than salesFinancial
Receivables up 120% against revenue up 34% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹152 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Deleveraging frees up earnings
Debt is down 17% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 32.8% to 6.3%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
The debt load needs earnings to hold up
Debt is 5.8x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Sales are being booked faster than collected
Receivables are up 120% against revenue up 34%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
The price already assumes success
The stock trades 39% above its own median multiple. At this level the business has to deliver just to stand still, and a stumble is repriced twice — lower earnings on a lower multiple.
Returns on shareholder capital are falling
ROE has dropped from 9.9% to -2.8%. 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.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 8% a year✓ 10.3% CAGR
Latest reported year was 436.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 4%✓ 6.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 5.8x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹152 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ -4.2x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

6 / 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

4 good · 2 neutral · 5 weak

Market Cap

₹3,632 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

93.1x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.28x

Rich

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

EPS (TTM)

₹7.85

Profitable

Profitable on a per-share basis

ROE

-2.8%

Weak

Weak capital efficiency

ROCE

-2.6%

Weak

Low return on total capital employed

Debt/Equity

0.14x

Low

Conservative leverage

Revenue Growth (YoY)

436.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

72.7%

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

-₹152 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

37.1x

Improving

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

Operating Margin

-17.3%

Weak

Thin margins leave little room for error

Net Margin

1.4%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.62

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

1.97

High swing

Swings more than the market in both directions

52W Range Position

58%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

723.4 / 766.6

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

50.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹169 Cr	₹301 Cr	₹161 Cr	₹226 Cr	+10.3%
EBITDA	₹55 Cr	₹72 Cr	-₹36 Cr	₹14 Cr	-36.2%
EBITDA Margin	32.8%	23.7%	-22.5%	6.3%	—
PAT (Net Profit)	₹32 Cr	₹45 Cr	-₹62 Cr	-₹17 Cr	—
EPS	₹7.68	₹10.77	₹-14.41	₹-3.9	—
ROE	9.9%	6.9%	-10.2%	-2.8%	—
ROCE	13.4%	9.6%	-9.9%	-2.6%	—
Total Debt	₹101 Cr	₹14 Cr	₹16 Cr	₹84 Cr	-5.9%
Free Cash Flow	-₹86 Cr	₹9 Cr	-₹165 Cr	-₹152 Cr	—

🟢 Revenue has grown at 10.3% a year over 3 years.

🔴 EBITDA has shrunk at 36.2% a year over 3 years.

🔴 EBITDA Margin has fallen from 32.8% to 6.3% over 3 years (-26.4 pts).

🔴 PAT (Net Profit) has turned negative, from ₹32 Cr to -₹17 Cr.

🔴 EPS has turned negative, from ₹7.68 to ₹-3.9.

🔴 ROE has fallen from 9.9% to -2.8% over 3 years (-12.7 pts).

🔴 ROCE has fallen from 13.4% to -2.6% over 3 years (-16.1 pts).

🟢 Total Debt has shrunk at 5.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹799 Cr

Total Liabilities

₹200 Cr

Cash & Equivalents

₹30 Cr

Operating Cash Flow

-₹63 Cr

Capex

-₹88 Cr

Shareholding (proxy)

Institutional Holding

16.1%

Insider Holding

42.8%

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,046

+43.2% vs CMP

Target Range

₹905 – ₹1,187

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

3 mixed1 negative2 general

Better Drone Stock: Zen Technologies vs Ideaforge Technology

Equitymaster, 15 Oct

Bearish: Analysts Just Cut Their ideaForge Technology Limited (NSE:IDEAFORGE) Revenue and EPS estimates

Simply Wall Street, 14 AugAnalyst view

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

ideaForge Technology shares slide 5% after Q1 gross profit margin falls 49%

The Economic Times, 11 AugResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Ideaforge Technology raises ₹500 Crore via QIP; issues 62.89 Lakh shares at ₹795 each

Sahi, 11 JulFunding

🟡Mixed / dependsNew funding changes the capital structure. Debt raises leverage; an equity raise dilutes existing holders.

Ideaforge Technology Share Price Slides 5% Even As Q1 Net Loss Narrows, Revenue Soars

NDTV Profit, 11 AugResults

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

Ideaforge zooms 144% since April, hits 2-year high; what's driving stock?

Business Standard, 04 Jun

Watch Items

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

DalalBaazaar Thesis

StrongGrowth

MiddlingFinancial Health

WeakBusiness Quality · Profitability · Valuation · Risk

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

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑