Micropro Software Solutions Limited

Sector n/a · NSE

₹42.55−₹1.35 (−3.08%)

DalalBaazaar Score

31 / 100

🔴 Weak

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:46 pm

Understanding the Business

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

How does it make money?

Turns over ₹19 Cr a year. Of every ₹100 of sales, about ₹-7 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?Little sign of one

Returns on capital of -1.5% 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.

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -14% while net margin moved -126% 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-14%

Margin effect-126%

DalalBaazaar Score

31/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✗ ROE has fallen by 37.7 points over the period

Quality vs. Valuation

Company Quality

28/ 100

Weak

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

Valuation

18/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

25.4x

PEG

—

What's Good / What's Bad

🟢 What's Going Well1

Debt is being paid down
Total debt is down 10% over 3 years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 34.8% to -2.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 45.9% to -1.5% — often a sign of competition or overexpansion.

Red Flags

7 items require attention · 5 high · 2 watch

🔴High leverageFinancial
Debt/Equity of 8.09x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only -12.1x — little room if earnings dip.
🔴Free cash flow negative for 3 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.
🔴The company is lossmakingFinancial
Net profit of -₹1 Cr in the latest reported year.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 30.2 points, from 43.0% to 12.7%.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from -6.1x to -12.1x.
🟡Receivables growing faster than salesFinancial
Receivables up 18% against revenue up -14% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

No clear supporting case emerges from the available numbers.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 43.0% to 12.7%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Leverage amplifies any setback
Debt/Equity of 8.09x. Interest is payable whether or not the business has a good year.
Sales are being booked faster than collected
Receivables are up 18% against revenue up -14%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Returns on shareholder capital are falling
ROE has dropped from 34.8% to -2.9%. 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.
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.

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

1EBITDA margin holds above 11%✓ 12.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✗ -₹3 Cr
Profit that never becomes cash eventually stops being profit.
3Interest cover stays above 3x✗ -12.1x
How much operating profit can fall before interest stops being comfortably covered.
4Debt / EBITDA stays below 2x✓ 1.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✗ -1.5%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

2 / 9 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
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

1 good · 5 neutral · 5 weak

Market Cap

₹61 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

-2.9%

Weak

Weak capital efficiency

ROCE

-1.5%

Weak

Low return on total capital employed

Debt/Equity

8.09x

High

High leverage

Revenue Growth (YoY)

-18.4%

Shrinking

Sales are contracting

Profit Growth (YoY)

30.1%

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

-₹3 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Gross Margin

29.2%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

-6.9%

Weak

Very little revenue reaches the bottom line

Current Ratio

4.82

Comfortable

Healthy short-term liquidity

Technical Snapshot

SMA 20 / SMA 50

17.6 / 18.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

43.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹22 Cr	₹21 Cr	₹23 Cr	₹19 Cr	-5.0%
EBITDA	₹9 Cr	₹6 Cr	₹1 Cr	₹2 Cr	-36.6%
EBITDA Margin	43.0%	28.2%	2.6%	12.7%	—
PAT (Net Profit)	₹6 Cr	₹3 Cr	-₹2 Cr	-₹1 Cr	—
EPS	₹3.99	₹2.61	₹-1.29	—	—
ROE	34.8%	6.6%	-4.1%	-2.9%	—
ROCE	45.9%	10.7%	-3.7%	-1.5%	—
Total Debt	₹4 Cr	₹4 Cr	—	₹4 Cr	-3.5%
Free Cash Flow	₹2 Cr	-₹11 Cr	-₹6 Cr	-₹3 Cr	—

🔴 Revenue has shrunk at 5.0% a year over 3 years.

🔴 EBITDA has shrunk at 36.6% a year over 3 years.

🔴 EBITDA Margin has fallen from 43.0% to 12.7% over 3 years (-30.2 pts).

🔴 PAT (Net Profit) has turned negative, from ₹6 Cr to -₹1 Cr.

🔴 ROE has fallen from 34.8% to -2.9% over 3 years (-37.7 pts).

🔴 ROCE has fallen from 45.9% to -1.5% over 3 years (-47.4 pts).

🟢 Total Debt has shrunk at 3.5% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2 Cr to -₹3 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹52 Cr

Total Liabilities

₹8 Cr

Cash & Equivalents

₹3 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹6 Cr

Recent News

6 general

Micropro Software Solutions (NSEI:MICROPRO) - Stock Analysis

Simply Wall Street, 11 Nov

Micropro Software Solutions share price makes a flat debut; shares list at ₹80 apiece on NSE SME

Livemint, 10 Nov

Micropro Software Solutions Ltd (MICROPRO) Share Price

Business Today, 16 Feb

MICROPRO Share Price

Upstox, 20 Mar

Micropro Software Solutions IPO Day 3: Issue subscribed over 36 times so far; check latest GMP, other key things to know

Livemint, 07 Nov

SHIPWAVES Stock Price and Chart — BSE:SHIPWAVES

TradingView, 17 Dec

Watch Items

Revenue growth is negative (-18.4%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
Sector/industry classification unavailable — verify manually for peer comparison.
3 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

MiddlingValuation

WeakBusiness Quality · Financial Health · Growth · Profitability · Risk

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 5 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Free cash flow remains positive; Interest cover stays above 3x; ROCE stays above 8% · see Key things to watch ↑