Infinity Infoway Limited

Technology — Software - Application · BSE

₹598.95+₹7.95 (+1.35%)

DalalBaazaar Score

70 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by moderate debt load, 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, 6:57 pm

Understanding the Business

Company site ↗

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

What does this company do?

Infinity Infoway Limited, a Software as a Service company, provides integrated online ERP software for manufacturing, education, retail, construction, supply chain and customer relationship management, sales force, and other industries in India and internationally.

IndustrySoftware - Application

SectorTechnology

Employees156

Annual revenue₹24 Cr

How does it make money?

Turns over ₹24 Cr a year. Of every ₹100 of sales, about ₹29 reaches shareholders as profit, with ₹45 left at the operating level before interest, tax and depreciation. Each of its 156 employees supports ₹15.2 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹15.2 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?Some evidence

ROCE of 22.5% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE32.0%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Trading within 10% of its 52-week high — entries here carry more pullback risk
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

79/ 100

Good

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

Valuation

49/ 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

35.7x

1.2Y Median

46.3x

14 monthly readings · mean 43.9x · range 35.3x–48.4x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 23% below its 1.2y median of 46.3x. 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 116% above the peer median of 16.5x.

vs. its own history

Cheap

46.3x median over 14 months · -23%

vs. sector peers

Expensive

16.5x median of 4 peers · +116%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

29.7x

PEG

0.60

What's Good / What's Bad

🟢 What's Going Well1

High return on capital employed
ROCE of 22.5% is the mark of a business that converts capital into profit efficiently.

🔴 What Needs Attention1

Return on equity is falling
ROE has dropped from 33.6% to 16.8% — each rupee of shareholder capital earns less than it did.

Red Flags

1 item require attention · 1 watch

🟡Free cash flow is negativeFinancial
Free cash flow was -₹8 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 22.5% 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.
Priced below its own history
The stock trades 23% 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?

A premium to the sector to defend
It trades 116% above the peer median. That premium needs a reason that persists, or it closes.
Returns on shareholder capital are falling
ROE has dropped from 33.6% to 16.8%. 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.
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.

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

1EBITDA margin holds above 43%✓ 44.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹8 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 0.0x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 19%✓ 22.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 46.3x✓ 35.7x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

8 / 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

5 good · 4 neutral · 2 weak

Market Cap

₹327 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

35.7x

Fair

Fairly valued against the generic band

P/B Ratio

7.80x

Rich

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

EPS (TTM)

₹16.77

Profitable

Profitable on a per-share basis

ROE

16.8%

Strong

Strong capital efficiency

ROCE

22.5%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

1.26x

Moderate

Moderate leverage

Revenue Growth (YoY)

119.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

35.7%

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

-₹8 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

34.2%

Good

Healthy core-business profitability

Net Margin

29.0%

Good

Strong bottom-line conversion

Current Ratio

29.31

Comfortable

Healthy short-term liquidity

52W Range Position

100%

Near high

Near its 52-week high

Technical Snapshot

SMA 20 / SMA 50

556.5 / 507.2

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

75.6

Overbought zone

Financial Trend (2-Year)

Metric	FY25	FY26	1Y CAGR
PAT (Net Profit)	₹4 Cr	₹7 Cr	+60.0%
EPS	₹8.04	₹15.03	+86.9%
ROE	33.6%	16.8%	—

🟢 PAT (Net Profit) has grown at 60.0% a year over 1 years.

🟢 EPS has grown at 86.9% a year over 1 years.

🔴 ROE has fallen from 33.6% to 16.8% over 1 years (-16.9 pts).

Balance Sheet & Cash Flow — FY2026

Total Assets

₹44 Cr

Total Liabilities

₹2 Cr

Total Debt

₹1 Cr

Cash & Equivalents

₹11 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹11 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

83.6%

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

Infinity Infoway Ltd is Rated Hold

MarketsMojo, 13 Oct

Compare with

Equitymaster, 16 Oct

Infinity Infoway Limited Share Price

Upstox, 05 May

Infinity Infoway Q1 FY27 Results: Revenue Rs 6 Cr, PAT Rs 2 Cr and Key Highlights

Univest, 12 AugResults

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

Compare with

Equitymaster, 27 Sept

₹23.85 to ₹1,400: Multibagger stock turns ₹1 lakh into ₹64 lakh in four years

Livemint, 09 Jan

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

StrongBusiness Quality · Growth · Profitability

MiddlingFinancial Health · Valuation

WeakRisk

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 — Free cash flow remains positive · see Key things to watch ↑