Technocrats Plasma Systems Limited

Industrials — Specialty Industrial Machinery · BSE

₹439.00+₹2.15 (+0.49%)

DalalBaazaar Score

57 / 100

🟡 Moderate

Verdict

CAUTION

Risk

High

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

In simple words: Strong business and financial position, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:01 pm

Understanding the Business

Company site ↗

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

What does this company do?

Technocrats Plasma Systems Limited manufactures and supplies plasma cutting machines, welding equipment, and customized automation systems for metal fabrication and related industries in India.

IndustrySpecialty Industrial Machinery

SectorIndustrials

Employees37

Annual revenue₹131 Cr

How does it make money?

Turns over ₹131 Cr a year. Of every ₹100 of sales, about ₹11 reaches shareholders as profit, with ₹20 left at the operating level before interest, tax and depreciation. Each of its 37 employees supports ₹3.55 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.55 Cr

Who are its competitors?

The closest listed comparisons in its industry are SIEMENS LTD, ABB INDIA LIMITED, LARSEN & TOUBRO LTD., HAVELLS INDIA 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?Some evidence

ROCE of 55.0% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE17.1%

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 +2847% while net margin moved -66% 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+2847%

Margin effect-66%

DalalBaazaar Score

57/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ P/E of 51.5x is demanding — it needs sustained high growth to justify
✗ P/B of 14.50x is a steep premium to book

Quality vs. Valuation

Company Quality

68/ 100

Good

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

Valuation

56/ 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

51.5x

Sector Median

66.2x

median of 4 sector peers

🟢Against its sector it trades 22% below the peer median of 66.2x.

vs. its own history

Not enough price and earnings history

vs. sector peers

Cheap

66.2x median of 4 peers · -22%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

29.8x

PEG

0.45

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 17.9% to 20.0% over 3 years.
Return on capital is rising
ROCE has improved from 11.8% to 55.0%.
High return on capital employed
ROCE of 55.0% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on equity is falling
ROE has dropped from 98.7% to 38.3% — each rupee of shareholder capital earns less than it did.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 123% over 3 years, from ₹7 Cr to ₹15 Cr.
🔴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.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹13 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 55.0% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 17.9% to 20.0%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Cheaper than its peers
It trades 22% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
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?

Returns on shareholder capital are falling
ROE has dropped from 98.7% to 38.3%. 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
2 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 157% a year✓ 208.9% CAGR
Latest reported year was 166.0%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 18%✓ 20.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹13 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.6x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 52%✓ 55.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

7 / 10 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

Price history

Quick Metrics

6 good · 2 neutral · 3 weak

Market Cap

₹768 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

51.5x

Expensive

Expensive — verify against sector peers

P/B Ratio

14.50x

Rich

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

EPS (TTM)

₹8.53

Profitable

Profitable on a per-share basis

ROE

59.9%

Strong

Strong capital efficiency

ROCE

55.0%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.53x

Low

Conservative leverage

Revenue Growth (YoY)

166.0%

Healthy

Healthy top-line growth

Profit Growth (YoY)

84.2%

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

-₹19 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

ROA

30.8%

Good

Assets are working hard

Operating Margin

16.1%

Good

Healthy core-business profitability

Net Margin

11.4%

Good

Strong bottom-line conversion

Current Ratio

2.80

Comfortable

Healthy short-term liquidity

52W Range Position

93%

Near high

Near its 52-week high

Technical Snapshot

RSI (14)

68.8

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹4 Cr	₹6 Cr	₹49 Cr	₹131 Cr	+208.9%
EBITDA	₹1 Cr	₹2 Cr	₹10 Cr	₹26 Cr	+220.3%
EBITDA Margin	17.9%	26.2%	19.4%	20.0%	—
PAT (Net Profit)	₹2 Cr	₹2 Cr	₹8 Cr	₹15 Cr	+114.7%
EPS	₹0.86	₹1.26	₹4.63	—	—
ROE	98.7%	59.0%	56.9%	38.3%	—
ROCE	11.8%	22.1%	38.2%	55.0%	—
Total Debt	₹7 Cr	₹7 Cr	₹10 Cr	₹15 Cr	+30.6%
Free Cash Flow	-₹1 Cr	₹1 Cr	-₹5 Cr	-₹13 Cr	—

🟢 Revenue has grown at 208.9% a year over 3 years.

🟢 EBITDA has grown at 220.3% a year over 3 years.

🟢 EBITDA Margin has risen from 17.9% to 20.0% over 3 years (+2.1 pts).

🟢 PAT (Net Profit) has grown at 114.7% a year over 3 years.

🔴 ROE has fallen from 98.7% to 38.3% over 3 years (-60.4 pts).

🟢 ROCE has risen from 11.8% to 55.0% over 3 years (+43.2 pts).

🔴 Total Debt has grown at 30.6% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹72 Cr

Total Liabilities

₹33 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

-₹12 Cr

Capex

-₹1 Cr

Shareholding (proxy)

Institutional Holding

1.1%

Insider Holding

67.8%

Peer Comparison

Company	P/E	ROE
SIEMENS LTD	88.8x	10.5%
ABB INDIA LIMITED	92.6x	19.1%
LARSEN & TOUBRO LTD.	30.1x	15.2%
HAVELLS INDIA LIMITED	43.5x	17.1%

Recent News

6 general

Compare with SPARC SYSTEM

Equitymaster, 18 Oct

SME stock Technocrats Plasma Systems zooms 83% against IPO price on debut

Business Standard, 21 Aug

Technocrats Plasma Systems Lim Share Price

Upstox, 21 Aug

Technocrats Plasma Systems Lim Lower Circuit: Price and Key Data

Univest, 01 Oct

Three SME IPOs to debut today; Technocrats Plasma Systems leads with 53% GMP

The Economic Times, 21 Aug

Technocrats Plasma appoints Khushi Patel as new company secretary

scanx.trade, 13 Oct

Watch Items

Trading very close to its 52-week high — momentum-driven entries here carry more mean-reversion risk.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Profitability

MiddlingFinancial Health · Growth

WeakValuation · Risk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 2 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑