IIFL Capital Services Limited

Financial Services — Capital Markets · NSE

₹348.00+₹0.90 (+0.26%)

DalalBaazaar Score

71 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by negative free cash flow, small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with modest growth. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

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

What does this company do?

IIFL Capital Services Limited provides capital market services in the primary and secondary markets in India.

IndustryCapital Markets

SectorFinancial Services

Employees1,553

Annual revenue₹1,982 Cr

How does it make money?

Turns over ₹1,982 Cr a year. Of every ₹100 of sales, about ₹28 reaches shareholders as profit, with ₹42 left at the operating level before interest, tax and depreciation. Each of its 1,553 employees supports ₹1.28 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹1.28 Cr

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC LIFE INS CO LTD, SBI LIFE INSURANCE CO 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?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE13.7%

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 +72% while net margin moved +30% 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+72%

Margin effect+30%

DalalBaazaar Score

71/ 100

Good

Weighted across six categories. Every point is explained below.

• P/E of 20.1x is within a normal band
✗ P/E is 21% above its own historical median of 16.6x — expensive by its own standards

Quality vs. Valuation

Company Quality

78/ 100

Good

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

Valuation

62/ 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

20.1x

3Y Median

16.6x

40 monthly readings · mean 17.1x · range 9.9x–26.0x

Sector Median

58.4x

median of 3 sector peers

⚠️Current valuation is approximately 21% above its 3y median of 16.6x. 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 66% below the peer median of 58.4x.

vs. its own history

Expensive

16.6x median over 40 months · +21%

vs. sector peers

Cheap

58.4x median of 3 peers · -66%

vs. generic bands

Fair

15x–35x

EV/EBITDA

14.9x

PEG

0.65

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 39.0% to 42.1% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on capital is falling
ROCE has declined from 25.3% to 22.1% — often a sign of competition or overexpansion.
Receivables growing faster than sales
Receivables are up 181% against revenue growth of 72% — customers are taking longer to pay.

Red Flags

No automated checks triggered

None of the automated financial checks below were triggered on the years of data available. That is not the same as a clean bill of health — see what could not be checked.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 39.0% to 42.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 66% 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?

The price already assumes success
The stock trades 21% 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.
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 15% a year✓ 19.9% CAGR
Latest reported year was 3.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 40%✓ 42.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 16%✓ 18.3%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Interest cover stays above 4x✓ 5.5x
How much operating profit can fall before interest stops being comfortably covered.
5Valuation vs its own median of 16.6x✗ 20.1x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

10 / 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

4 good · 6 neutral · 1 weak

Market Cap

₹10,974 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

20.1x

Fair

Fairly valued against the generic band

P/B Ratio

3.53x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹17.34

Profitable

Profitable on a per-share basis

ROE

18.3%

Strong

Strong capital efficiency

ROCE

22.1%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.59x

Low

Conservative leverage

Revenue Growth (YoY)

3.3%

Modest

Modest growth

Profit Growth (YoY)

4.5%

Modest

Slow profit growth

Dividend Yield

0.86%

Modest

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

Free Cash Flow

-₹1,098 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

36.2%

Good

Healthy core-business profitability

Net Margin

24.5%

Good

Strong bottom-line conversion

Current Ratio

1.67

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.78

Defensive

Steadier than the market

52W Range Position

63%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

345.7 / 340.0

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

52.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,150 Cr	₹1,832 Cr	₹1,986 Cr	₹1,982 Cr	+19.9%
EBITDA	₹448 Cr	₹844 Cr	₹967 Cr	₹834 Cr	+23.0%
EBITDA Margin	39.0%	46.0%	48.7%	42.1%	—
PAT (Net Profit)	₹250 Cr	₹512 Cr	₹712 Cr	₹561 Cr	+30.9%
EPS	₹8.16	₹16.4	₹21.89	₹17.07	+27.9%
ROE	18.5%	28.7%	28.4%	18.3%	—
ROCE	25.3%	39.4%	37.8%	22.1%	—
Total Debt	₹516 Cr	₹1,202 Cr	₹1,039 Cr	₹1,923 Cr	+55.0%
Free Cash Flow	-₹806 Cr	-₹149 Cr	₹823 Cr	-₹1,098 Cr	—

🟢 Revenue has grown at 19.9% a year over 3 years.

🟢 EBITDA has grown at 23.0% a year over 3 years.

🟢 EBITDA Margin has risen from 39.0% to 42.1% over 3 years (+3.1 pts).

🟢 PAT (Net Profit) has grown at 30.9% a year over 3 years.

🟢 EPS has grown at 27.9% a year over 3 years.

🟡 ROE has held roughly flat at 18.3% over 3 years.

🔴 ROCE has fallen from 25.3% to 22.1% over 3 years (-3.2 pts).

🔴 Total Debt has grown at 55.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹9,558 Cr

Total Liabilities

₹6,487 Cr

Cash & Equivalents

₹425 Cr

Operating Cash Flow

-₹1,070 Cr

Capex

-₹28 Cr

Shareholding (proxy)

Institutional Holding

14.6%

Insider Holding

58.5%

Corporate Actions

Dividend Rate

₹3

Ex-Dividend Date

16 Feb 2026

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC LIFE INS CO LTD	58.4x	11.3%
SBI LIFE INSURANCE CO LTD	63.9x	13.7%

Recent News

2 mixed4 general

IIFL Capital Services CRO Mahesh Moopannar resigns effective Oct 15, 2026

scanx.trade, 15 Oct

IIFL Capital Services Share Price Target 2026: Rs 345 to 414

Univest, 05 OctAnalyst view

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

Fairfax Financial plans to merge Digit, IIFL Capital with IDBI Bank

Business Standard, 15 Oct

Fairfax to gain majority stake in IIFL Capital with $211 mn investment

VCCircle, 07 May

IIFL Capital Services Ltd Peer Comparison – Compare with Others

Value Research, 29 Aug

IIFL Capital shares rise up to 6% as Fairfax to raise stake with Rs 2,000-crore investment

Moneycontrol.com, 07 MayPrice 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

This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability

MiddlingValuation · 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.

1 of 5 tripwires tripped — Valuation vs its own median of 16.6x · see Key things to watch ↑