Neo Infracon Limited

Real Estate — Real Estate - Development · BSE

₹42.05+₹0.56 (+1.35%)

DalalBaazaar Score

51 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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

In simple words: Reasonable but unspectacular business quality, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:02 pm

Understanding the Business

Company site ↗

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

What does this company do?

Neo Infracon Limited engages in the real estate development and construction business in India. It develops and constructs commercial or industrial building and civil structures, as well as residential complexes.

IndustryReal Estate - Development

SectorReal Estate

Annual revenue₹8 Cr

How does it make money?

Turns over ₹8 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹31 left at the operating level before interest, tax and depreciation.

Who are its competitors?

The closest listed comparisons in its industry are DLF LIMITED, GODREJ PROPERTIES LTD, OBEROI REALTY LIMITED. 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 13.0% 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 ROE10.3%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +24% while net margin moved -537% 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+24%

Margin effect-537%

DalalBaazaar Score

51/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 45.7x is demanding — it needs sustained high growth to justify
✗ P/E is 76% above its own historical median of 26.0x — expensive by its own standards

Quality vs. Valuation

Company Quality

56/ 100

Average

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

Valuation

28/ 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

45.7x

1.3Y Median

26.0x

16 monthly readings · mean 26.4x · range 23.3x–30.6x

Sector Median

30.2x

median of 3 sector peers

⚠️Current valuation is approximately 76% above its 1.3y median of 26.0x. 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 51% above the peer median of 30.2x.

vs. its own history

Expensive

26.0x median over 16 months · +76%

vs. sector peers

Expensive

30.2x median of 3 peers · +51%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

15.5x

PEG

3.19

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 12.7% to 30.6% over 3 years.
Return on equity is rising
ROE has improved from -2.7% to 11.8%.
Return on capital is rising
ROCE has improved from 7.0% to 13.0%.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

3 items require attention · 3 high

🔴High leverageFinancial
Debt/Equity of 2.08x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only 2.0x — little room if earnings dip.
🔴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.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 12.7% to 30.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 6.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
The price already assumes success
The stock trades 76% 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.
Growth barely outpaces inflation
Revenue compounding at 7.5% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
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.

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

1EBITDA margin holds above 29%✓ 30.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA falls below 3x✗ 6.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
3Interest cover stays above 3x✗ 2.0x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 6% a year✓ 7.5% CAGR
Latest reported year was -70.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹1 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

5 / 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

3 good · 5 neutral · 3 weak

Market Cap

₹22 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

45.7x

Expensive

Expensive — verify against sector peers

P/B Ratio

2.93x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹0.92

Profitable

Profitable on a per-share basis

ROE

11.8%

Moderate

Moderate capital efficiency

ROCE

13.0%

Moderate

Moderate return on the capital in the business

Debt/Equity

2.08x

High

High leverage

Revenue Growth (YoY)

-70.8%

Shrinking

Sales are contracting

Profit Growth (YoY)

14.3%

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

₹1 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

10.6%

Average

Average margins

Net Margin

8.2%

Average

Average bottom-line conversion

Current Ratio

1.78

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.14

Defensive

Steadier than the market

52W Range Position

47%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

42.5 / 42.1

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

49.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹6 Cr	₹4 Cr	₹10 Cr	₹8 Cr	+7.5%
EBITDA	₹1 Cr	₹1 Cr	₹2 Cr	₹2 Cr	+44.2%
EBITDA Margin	12.7%	18.4%	23.2%	30.6%	—
PAT (Net Profit)	-₹0 Cr	-₹0 Cr	₹1 Cr	₹1 Cr	—
EPS	₹-0.31	₹-0.24	₹1.48	₹1.7	—
ROE	-2.7%	-2.1%	11.7%	11.8%	—
ROCE	7.0%	2.7%	12.9%	13.0%	—
Total Debt	₹13 Cr	₹17 Cr	₹16 Cr	₹16 Cr	+6.5%
Free Cash Flow	₹2 Cr	-₹3 Cr	₹2 Cr	₹1 Cr	-12.7%

🟢 Revenue has grown at 7.5% a year over 3 years.

🟢 EBITDA has grown at 44.2% a year over 3 years.

🟢 EBITDA Margin has risen from 12.7% to 30.6% over 3 years (+17.9 pts).

🟢 PAT (Net Profit) has turned positive, from -₹0 Cr to ₹1 Cr.

🟢 EPS has turned positive, from ₹-0.31 to ₹1.7.

🟢 ROE has risen from -2.7% to 11.8% over 3 years (+14.5 pts).

🟢 ROCE has risen from 7.0% to 13.0% over 3 years (+6.0 pts).

🔴 Total Debt has grown at 6.5% a year over 3 years.

🔴 Free Cash Flow has shrunk at 12.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹32 Cr

Total Liabilities

₹25 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹1 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

76.9%

Peer Comparison

Company	P/E	ROE
DLF LIMITED	36.6x	10.3%
GODREJ PROPERTIES LTD	30.2x	8.4%
OBEROI REALTY LIMITED	23.5x	14.7%

Recent News

1 positive5 general

Neo Infracon promoter group acquires 7,787 shares in open market

scanx.trade, 26 Sept

Construction Penny Stocks in India 2027: 5 Picks

Univest, 17 Sept

Neo Infracon accepts resignation of Company Secretary Sonalben Kanabar

scanx.trade, 03 Oct

CITADEL Stock Price and Chart — BSE:CITADEL

TradingView, 18 Sept

GPT Infraprojects consolidated net profit rises 31.52% in the March 2026 quarter

Business Standard, 21 MayResults

🟢Potentially positiveReported improvement. Check whether it came from volume, price or a one-off item before treating it as a trend.

Neo Infracon promoter buys 10,000 shares in open market

scanx.trade, 03 Sept

Watch Items

Revenue growth is negative (-70.8%) 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.

DalalBaazaar Thesis

StrongBusiness Quality

MiddlingFinancial Health · Profitability

WeakGrowth · 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. 3 high-severity red flags sit above this conclusion and should be read first.

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