NIS Management Limited

Industrials — Security & Protection Services · BSE

₹39.38−₹0.62 (−1.55%)

DalalBaazaar Score

43 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

Driven by micro-cap size, which brings thin liquidity, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, with modest growth. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:09 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

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

What does this company do?

NIS Management Limited provides security and facility management services in India. The company offers housekeeping, payroll management, event security, investigation, skill development and training, and due diligence services, as well as electronic security services.

IndustrySecurity & Protection Services

SectorIndustrials

Employees18,673

Annual revenue₹433 Cr

How does it make money?

Turns over ₹433 Cr a year. Of every ₹100 of sales, about ₹-0 reaches shareholders as profit, with ₹8 left at the operating level before interest, tax and depreciation. Each of its 18,673 employees supports ₹2.3 lakh of revenue a year, the signature of a people-led business.

EBITDA margin7.6%

Net margin-0.4%

Revenue / employee₹2.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are LARSEN & TOUBRO LTD., SIEMENS LTD, ABB INDIA LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

LARSEN & TOUBRO LTD.P/E 30.1x · ROE 15.2%

SIEMENS LTDP/E 88.8x · ROE 10.5%

ABB INDIA LIMITEDP/E 92.6x · ROE 19.1%

What is its competitive advantage?Little sign of one

Returns on capital of 1.2% 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.

ROCE1.2%

ROE-0.9%

Peer median ROE15.2%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +27% while net margin moved -109% 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+27%

Margin effect-109%

DalalBaazaar Score

43/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative
✗ ROE has fallen by 15.0 points over the period

Quality vs. Valuation

Company Quality

47/ 100

Average

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

Valuation

53/ 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

65.6x

1.3Y Median

5.8x

15 monthly readings · mean 6.0x · range 4.2x–9.3x

Sector Median

88.8x

median of 3 sector peers

⚠️Current valuation is approximately 1030% above its 1.3y median of 5.8x. 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 26% below the peer median of 88.8x.

vs. its own history

Expensive

5.8x median over 15 months · +1030%

vs. sector peers

Cheap

88.8x median of 3 peers · -26%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

65.6x

P/B

0.33x

EV/EBITDA

4.5x

PEG

18.75

Dividend Yield

None

What's Good / What's Bad

🟢 What's Going Well0

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

🔴 What Needs Attention4

Return on equity is falling
ROE has dropped from 14.1% to -0.9% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 20.1% to 1.2% — often a sign of competition or overexpansion.
Inventory building faster than sales
Inventory is up 146% against revenue growth of 27% — stock may not be moving.
Valuation above its historical average
At 65.6x the stock trades 1030% above its own median of 5.8x.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only 0.3x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹2 Cr in the latest reported year.
🔴Inventory building faster than salesFinancial
Inventory up 146% against revenue up 27% — stock may not be moving.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 3.3x to 0.3x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Cheaper than its peers
It trades 26% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹8 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.

🔴 Bear CaseWhat could go wrong?

The price already assumes success
The stock trades 1030% 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 14.1% to -0.9%. 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.
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.
Several serious flags at once
3 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

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

1EBITDA margin holds above 6%✓ 7.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Debt / EBITDA stays below 2x✗ 2.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
3Interest cover stays above 3x✗ 0.3x
How much operating profit can fall before interest stops being comfortably covered.
4Revenue growth stays above 6% a year✓ 8.4% CAGR
Latest reported year was 15.2%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
5Free cash flow remains positive✓ ₹8 Cr
Profit that never becomes cash eventually stops being profit.

Investment Checklist

6 / 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 · 3 neutral · 3 weak

Market Cap

₹78 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

65.6x

Expensive

Expensive — verify against sector peers

P/B Ratio

0.33x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹0.6

Profitable

Profitable on a per-share basis

ROE

-0.9%

Weak

Weak capital efficiency

ROCE

1.2%

Weak

Low return on total capital employed

Debt/Equity

0.42x

Low

Conservative leverage

Revenue Growth (YoY)

15.2%

Healthy

Healthy top-line growth

Profit Growth (YoY)

3.5%

Modest

Slow profit growth

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹8 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹39.38

Operating Margin

6.7%

Average

Average margins

Net Margin

-0.0%

Weak

Very little revenue reaches the bottom line

Current Ratio

2.59

Comfortable

Healthy short-term liquidity

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

40.3 / 44.2

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

46.7

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹341 Cr	₹378 Cr	₹402 Cr	₹433 Cr	+8.4%
EBITDA	₹30 Cr	₹33 Cr	₹29 Cr	₹33 Cr	+3.6%
EBITDA Margin	8.7%	8.8%	7.3%	7.6%	—
PAT (Net Profit)	₹16 Cr	₹18 Cr	₹19 Cr	-₹2 Cr	—
EPS	₹8.15	₹9.28	₹9.43	₹-1.04	—
ROE	14.1%	13.8%	12.3%	-0.9%	—
ROCE	20.1%	21.4%	17.0%	1.2%	—
Total Debt	₹87 Cr	₹91 Cr	₹84 Cr	₹83 Cr	-1.6%
Free Cash Flow	₹8 Cr	₹12 Cr	₹8 Cr	₹8 Cr	+2.2%

🟢 Revenue has grown at 8.4% a year over 3 years.

🟢 EBITDA has grown at 3.6% a year over 3 years.

🔴 EBITDA Margin has fallen from 8.7% to 7.6% over 3 years (-1.1 pts).

🔴 PAT (Net Profit) has turned negative, from ₹16 Cr to -₹2 Cr.

🔴 EPS has turned negative, from ₹8.15 to ₹-1.04.

🔴 ROE has fallen from 14.1% to -0.9% over 3 years (-15.0 pts).

🔴 ROCE has fallen from 20.1% to 1.2% over 3 years (-18.9 pts).

🟡 Total Debt has been broadly flat over 3 years (-1.6% a year).

🟢 Free Cash Flow has grown at 2.2% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹329 Cr

Total Liabilities

₹133 Cr

Total Debt

₹83 Cr

Cash & Equivalents

₹12 Cr

Operating Cash Flow

₹10 Cr

Capex

-₹2 Cr

Shareholding (proxy)

Institutional Holding

1.2%

Insider Holding

73.6%

Peer Comparison

Company	P/E	ROE
LARSEN & TOUBRO LTD.	30.1x	15.2%
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%

Recent News

1 negative5 general

Compare Company

Equitymaster, 30 Sept

NIS Management fined ₹95,000 by BSE for reporting lapse in FY26

scanx.trade, 02 SeptRegulatory

🔴Potentially negativeRegulatory and legal actions carry a financial cost and a governance question. The second usually matters more than the first.

NIS MANAGEMENT LIMITED Share Price - Live NISMGMT Stock Price & Chart

Upstox, 05 May

NIS Management receives SBI SME Rhodium status

Business Standard, 25 Aug

Compare with

Equitymaster, 11 Oct

NIS Management files writ petition against ESIC over ₹2.17 crore claim

scanx.trade, 25 Sept

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🔴Business QualityWeak4.7/20

🟢Financial HealthStrong14.2/20

🟢GrowthStrong13.6/20

🔴ProfitabilityWeak2.5/15

🔴ValuationDemanding6.2/15

🔴RiskHigh1.8/10

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.

This thesis breaks if

✓EBITDA margin holds above 6%7.6%
✗Debt / EBITDA stays below 2x2.5x
✗Interest cover stays above 3x0.3x
✓Revenue growth stays above 6% a year8.4% CAGR
✓Free cash flow remains positive₹8 Cr