Syrma SGS Technology Limited

Technology — Electronic Components · NSE

₹1,604.00−₹83.30 (−4.94%)

DalalBaazaar Score

69 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by a very high earnings multiple, which leaves little margin for disappointment.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Valuation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:00 pm

Understanding the Business

Company site ↗

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

What does this company do?

Syrma SGS Technology Limited operates as an electronics system design and manufacturing company in India, the United States, Germany, and internationally.

IndustryElectronic Components

SectorTechnology

Employees1,552

Annual revenue₹4,705 Cr

How does it make money?

Turns over ₹4,705 Cr a year. Of every ₹100 of sales, about ₹7 reaches shareholders as profit, with ₹12 left at the operating level before interest, tax and depreciation. Each of its 1,552 employees supports ₹3.03 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.03 Cr

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 14.7% 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 is the outlook?

22 analysts covering the stock expect revenue to grow about 32.6% and earnings to grow about 40.5% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+32.6%

Est. earnings growth+40.5%

Analysts22

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 +134% while net margin moved +14% 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+134%

Margin effect+14%

DalalBaazaar Score

69/ 100

Good

Weighted across six categories. Every point is explained below.

✗ P/E of 83.4x is demanding — it needs sustained high growth to justify
• P/E is close to its own historical median of 86.0x
✗ P/B of 10.72x is a steep premium to book

Quality vs. Valuation

Company Quality

75/ 100

Good

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

Valuation

35/ 100

Expensive

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

A good business, but the price already reflects that. The quality is real; the question is whether you are overpaying for it today.

Historical Valuation

Current P/E

83.4x

3Y Median

86.0x

40 monthly readings · mean 88.8x · range 68.7x–146.7x

Sector Median

16.5x

median of 4 sector peers

🟡Currently trading close to its 3y median of 86.0x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 404% above the peer median of 16.5x.

vs. its own history

Fair

86.0x median over 40 months · -3%

vs. sector peers

Expensive

16.5x median of 4 peers · +404%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

54.6x

PEG

2.16

What's Good / What's Bad

🟢 What's Going Well5

Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from 7.7% to 11.1%.
Return on capital is rising
ROCE has improved from 11.8% to 14.7%.
Very low debt
Debt/Equity of 0.13x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

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

Red Flags

1 item require attention · 1 high

🔴Receivables growing faster than salesFinancial
Receivables up 358% against revenue up 134% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Self-funding with balance-sheet headroom
Positive free cash flow of ₹98 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
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?

Sales are being booked faster than collected
Receivables are up 358% against revenue up 134%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
A premium to the sector to defend
It trades 404% above the peer median. That premium needs a reason that persists, or it closes.

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

1Revenue growth stays above 25% a year✓ 32.8% CAGR
Latest reported year was 68.3%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 10%✓ 12.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹98 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 12%✓ 14.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

8 / 12 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
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 4 neutral · 2 weak

Market Cap

₹30,897 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

83.4x

Expensive

Expensive — verify against sector peers

P/B Ratio

10.72x

Rich

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

EPS (TTM)

₹19.23

Profitable

Profitable on a per-share basis

ROE

11.1%

Moderate

Moderate capital efficiency

ROCE

14.7%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.13x

Low

Conservative leverage

Revenue Growth (YoY)

68.3%

Healthy

Healthy top-line growth

Profit Growth (YoY)

86.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.09%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹98 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

49.8x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

8.8%

Average

Average margins

Net Margin

6.7%

Average

Average bottom-line conversion

Current Ratio

1.70

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.18

Defensive

Steadier than the market

52W Range Position

82%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

1711.1 / 1582.8

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

38.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,010 Cr	₹3,130 Cr	₹3,716 Cr	₹4,705 Cr	+32.8%
EBITDA	₹229 Cr	₹253 Cr	₹343 Cr	₹570 Cr	+35.6%
EBITDA Margin	11.4%	8.1%	9.2%	12.1%	—
PAT (Net Profit)	₹119 Cr	₹107 Cr	₹170 Cr	₹318 Cr	+38.6%
EPS	₹6.75	₹6.02	₹9.52	₹16.92	+35.8%
ROE	7.7%	6.7%	9.7%	11.1%	—
ROCE	11.8%	11.0%	14.6%	14.7%	—
Total Debt	₹375 Cr	₹630 Cr	₹665 Cr	₹400 Cr	+2.2%
Free Cash Flow	-₹189 Cr	-₹447 Cr	-₹69 Cr	₹98 Cr	—

🟢 Revenue has grown at 32.8% a year over 3 years.

🟢 EBITDA has grown at 35.6% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 12.1% over 3 years.

🟢 PAT (Net Profit) has grown at 38.6% a year over 3 years.

🟢 EPS has grown at 35.8% a year over 3 years.

🟢 ROE has risen from 7.7% to 11.1% over 3 years (+3.4 pts).

🟢 ROCE has risen from 11.8% to 14.7% over 3 years (+2.8 pts).

🔴 Total Debt has grown at 2.2% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹189 Cr to ₹98 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹5,770 Cr

Total Liabilities

₹2,705 Cr

Cash & Equivalents

₹192 Cr

Operating Cash Flow

₹290 Cr

Capex

-₹192 Cr

Shareholding (proxy)

Institutional Holding

17.6%

Insider Holding

59.6%

Corporate Actions

Dividend Rate

₹1.5

Ex-Dividend Date

18 Aug 2026

Analyst Consensus

Recommendations

19 Buy · 5 Hold · 2 Sell

Target Price (Mean)

₹1,677.12

+4.6% vs CMP

Target Range

₹940 – ₹2,156

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

2 mixed4 general

Syrma SGS Technology (NSEI:SYRMA) Stock Forecast & Analyst Predictions

Simply Wall Street, 14 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

What Syrma SGS Technology Holders Bought Into Before A 135% Run

Yahoo Finance, 15 Oct

Syrma SGS Technology Share Price News After Rs 50.20 Drop

Univest, 31 Aug

SYRMA Forecast — Price Target — Prediction for 2027

TradingView, 25 JunAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

10 stocks held by 100+ MF schemes in September rally up to 205% in CY26; 6 turn multibaggers

The Economic Times, 16 Oct

Syrma SGS Technology soars 9%, up 125% in 2026; what's driving EMS stock?

Business Standard, 17 Sept

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongFinancial Health · Growth · Risk

MiddlingBusiness Quality · Profitability

WeakValuation

Points for each in the Score ↑

Good business, demanding price

The quality is real and the price already reflects it. Buying here is a bet that the business keeps compounding for long enough to grow into the multiple — which good businesses often do, but it removes the margin for error that a lower price would have given you. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑