Olatech Solutions Limited

Technology — Information Technology Services · BSE

₹53.77+₹0.66 (+1.24%)

DalalBaazaar Score

53 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, falling profits.

In simple words: Reasonable but unspectacular business quality, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:44 pm

Understanding the Business

Company site ↗

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

What does this company do?

Olatech Solutions Limited provides data centre, enterprise, telecom, and information technology software solutions in the operations support system and business support system segments in India.

IndustryInformation Technology Services

SectorTechnology

Employees191

Annual revenue₹28 Cr

How does it make money?

Turns over ₹28 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹14 left at the operating level before interest, tax and depreciation. Each of its 191 employees supports ₹14.5 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹14.5 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?Little sign of one

Returns on capital of 15.0% 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 ROE32.0%

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 +271% while net margin moved -61% 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+271%

Margin effect-61%

DalalBaazaar Score

53/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROE of 8.9% is weak
✗ ROE has fallen by 18.6 points over the period

Quality vs. Valuation

Company Quality

48/ 100

Average

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

Valuation

78/ 100

Cheap

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

14.2x

3Y Median

28.5x

40 monthly readings · mean 26.9x · range 6.1x–69.9x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 50% below its 3y median of 28.5x. 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 is priced broadly in line with the peer median of 16.5x.

vs. its own history

Cheap

28.5x median over 40 months · -50%

vs. sector peers

Fair

16.5x median of 4 peers · -14%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

7.3x

PEG

1.12

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 27.1% to 8.5% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 35.8% to 15.0% — often a sign of competition or overexpansion.

Red Flags

4 items require attention · 3 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 3028% over 3 years, from ₹0 Cr to ₹10 Cr.
🔴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.
🔴Significant margin compressionFinancial
EBITDA margin has fallen 9.7 points, from 23.7% to 14.0%.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 32.0x to 3.0x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 50% 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.
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?

Margins are being competed away
EBITDA margin has fallen from 23.7% to 14.0%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
Returns on shareholder capital are falling
ROE has dropped from 27.1% to 8.5%. 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.
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

1Revenue growth stays above 41% a year✓ 54.8% CAGR
Latest reported year was 13.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 12%✓ 14.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹3 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✓ 3.0x
How much operating profit can fall before interest stops being comfortably covered.

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

5 good · 4 neutral · 2 weak

Market Cap

₹24 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

14.2x

Cheap

Cheap against the generic band

P/B Ratio

1.20x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹3.79

Profitable

Profitable on a per-share basis

ROE

8.9%

Moderate

Moderate capital efficiency

ROCE

15.0%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.52x

Low

Conservative leverage

Revenue Growth (YoY)

13.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-60.0%

Falling

Profits are shrinking

Dividend Yield

None

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

Free Cash Flow

-₹4 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

5.7%

Average

Average asset productivity

Operating Margin

-4.6%

Weak

Thin margins leave little room for error

Net Margin

5.9%

Average

Average bottom-line conversion

Current Ratio

1.44

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

-0.55

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

60.4 / 63.9

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

27.0

Oversold zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹7 Cr	₹15 Cr	₹21 Cr	₹28 Cr	+54.8%
EBITDA	₹2 Cr	₹4 Cr	₹6 Cr	₹4 Cr	+29.7%
EBITDA Margin	23.7%	28.5%	27.6%	14.0%	—
PAT (Net Profit)	₹1 Cr	₹3 Cr	₹4 Cr	₹2 Cr	+12.7%
EPS	₹5.07	₹6.97	₹8.82	—	—
ROE	27.1%	40.8%	23.3%	8.5%	—
ROCE	35.8%	53.8%	30.3%	15.0%	—
Total Debt	₹0 Cr	₹0 Cr	₹2 Cr	₹10 Cr	+215.1%
Free Cash Flow	₹1 Cr	-₹0 Cr	-₹0 Cr	-₹3 Cr	—

🟢 Revenue has grown at 54.8% a year over 3 years.

🟢 EBITDA has grown at 29.7% a year over 3 years.

🔴 EBITDA Margin has fallen from 23.7% to 14.0% over 3 years (-9.7 pts).

🟢 PAT (Net Profit) has grown at 12.7% a year over 3 years.

🔴 ROE has fallen from 27.1% to 8.5% over 3 years (-18.6 pts).

🔴 ROCE has fallen from 35.8% to 15.0% over 3 years (-20.8 pts).

🔴 Total Debt has grown at 215.1% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹1 Cr to -₹3 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹46 Cr

Total Liabilities

₹26 Cr

Cash & Equivalents

₹6 Cr

Operating Cash Flow

₹0 Cr

Capex

-₹3 Cr

Shareholding (proxy)

Institutional Holding

0.0%

Insider Holding

77.0%

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

6 general

Olatech Solutions Limited Issues Clarification on Share Price Movement to BSE

scanx.trade, 10 Apr

Olatech Solutions Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 04 Sept

Olatech Solutions accepts Navneet Kakkar's resignation as CEO

scanx.trade, 25 Jun

Bonus shares: Olatech Solutions shares to trade ex-bonus today. Details here

Livemint, 20 Nov

OLATECH Stock Price and Chart — BSE:OLATECH

TradingView, 29 Aug

Ola Electric Falls, but this SME Stock with 'Ola' in its Name Spikes 50% in a Month

Equitymaster, 12 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.
RSI is in oversold territory — could mean either a bargain or a stock still falling for good reason. Check the 'why' before assuming reversal.

DalalBaazaar Thesis

StrongValuation

MiddlingBusiness Quality · Financial Health · Growth

WeakProfitability · 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 stays below 2x; Free cash flow remains positive · see Key things to watch ↑