Usha Martin Education & Solutions Limited

Consumer Defensive — Education & Training Services · NSE

₹4.95+₹0.24 (+5.10%)

DalalBaazaar Score

67 / 100

🟢 Good

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, but sales are shrinking. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:48 pm

Understanding the Business

Company site ↗

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

What does this company do?

Usha Martin Education & Solutions Limited provides educational services in India.

IndustryEducation & Training Services

SectorConsumer Defensive

Annual revenue₹1 Cr

How does it make money?

Turns over ₹1 Cr a year. Of every ₹100 of sales, about ₹45 reaches shareholders as profit, with ₹53 left at the operating level before interest, tax and depreciation.

Who are its competitors?

The closest listed comparisons in its industry are HINDUSTAN UNILEVER LTD., ITC LTD, NESTLE INDIA LIMITED, BRITANNIA INDUSTRIES 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?Some evidence

ROCE of 18.2% 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 ROE51.0%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +34% while net margin moved +364% 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+34%

Margin effect+364%

DalalBaazaar Score

67/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of -0.51 — historically steadier than the index
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ High leverage magnifies any downturn in earnings
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

73/ 100

Good

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

Valuation

57/ 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

35.4x

3Y Median

100.3x

40 monthly readings · mean 135.7x · range 29.9x–443.5x

Sector Median

43.3x

median of 4 sector peers

🟢Current valuation is approximately 65% below its 3y median of 100.3x. 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 trades 18% below the peer median of 43.3x.

vs. its own history

Cheap

100.3x median over 40 months · -65%

vs. sector peers

Fair

43.3x median of 4 peers · -18%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

28.7x

PEG

0.42

What's Good / What's Bad

🟢 What's Going Well6

Margins are improving
EBITDA margin is up from 17.9% to 53.3% over 3 years.
Debt is being paid down
Total debt is down 91% over 3 years.
Cash generation is improving
Free cash flow is up 272% over 3 years.
Return on equity is rising
ROE has improved from 0.4% to 16.1%.
Return on capital is rising
ROCE has improved from 0.7% to 18.2%.
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

3 items require attention · 2 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 9.18x — earnings must service borrowings before shareholders see anything.
🔴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.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.30 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 18.2% 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 53.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 91% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
Priced below its own history
The stock trades 65% 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?

Leverage amplifies any setback
Debt/Equity of 9.18x. Interest is payable whether or not the business has a good year.
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 8% a year✓ 10.3% CAGR
Latest reported year was -9.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 51%✓ 53.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹0 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 15%✓ 18.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

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

4 good · 4 neutral · 3 weak

Market Cap

₹13 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

35.4x

Fair

Fairly valued against the generic band

P/B Ratio

5.64x

Rich

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

EPS (TTM)

₹0.14

Profitable

Profitable on a per-share basis

ROE

16.1%

Strong

Strong capital efficiency

ROCE

18.2%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

9.18x

High

High leverage

Revenue Growth (YoY)

-9.4%

Shrinking

Sales are contracting

Profit Growth (YoY)

0.0%

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

₹0 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Operating Margin

23.8%

Good

Healthy core-business profitability

Net Margin

44.9%

Good

Strong bottom-line conversion

Current Ratio

0.30

Tight

Tight short-term liquidity

Beta (vs Nifty)

-0.51

Defensive

Steadier than the market

52W Range Position

35%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

4.5 / 5.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

60.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1 Cr	₹1 Cr	₹1 Cr	₹1 Cr	+10.3%
EBITDA	₹0 Cr	₹1 Cr	₹0 Cr	₹0 Cr	+58.7%
EBITDA Margin	17.9%	80.5%	60.1%	53.3%	—
PAT (Net Profit)	₹0 Cr	₹0 Cr	₹0 Cr	₹0 Cr	+84.0%
EPS	₹0.02	₹0.06	₹0.12	₹0.15	+95.7%
ROE	0.4%	1.1%	17.2%	16.1%	—
ROCE	0.7%	3.5%	25.3%	18.2%	—
Total Debt	₹3 Cr	₹2 Cr	₹1 Cr	₹0 Cr	-55.6%
Free Cash Flow	₹0 Cr	₹1 Cr	₹1 Cr	₹0 Cr	+55.0%

🟢 Revenue has grown at 10.3% a year over 3 years.

🟢 EBITDA has grown at 58.7% a year over 3 years.

🟢 EBITDA Margin has risen from 17.9% to 53.3% over 3 years (+35.4 pts).

🟢 PAT (Net Profit) has grown at 84.0% a year over 3 years.

🟢 EPS has grown at 95.7% a year over 3 years.

🟢 ROE has risen from 0.4% to 16.1% over 3 years (+15.6 pts).

🟢 ROCE has risen from 0.7% to 18.2% over 3 years (+17.5 pts).

🟢 Total Debt has shrunk at 55.6% a year over 3 years.

🟢 Free Cash Flow has grown at 55.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3 Cr

Total Liabilities

₹1 Cr

Cash & Equivalents

₹0 Cr

Operating Cash Flow

₹0 Cr

Capex

-₹0 Cr

Shareholding (proxy)

Institutional Holding

1.7%

Insider Holding

34.2%

Peer Comparison

Company	P/E	ROE
HINDUSTAN UNILEVER LTD.	42.5x	21.5%
ITC LTD	16.6x	27.4%
NESTLE INDIA LIMITED	59.8x	79.9%
BRITANNIA INDUSTRIES LTD	44.1x	51.0%

Recent News

6 general

Usha Martin to Supreme Engineering: 10 penny stocks below ₹10 defy stock market crash, surge up to 60% in March

Livemint, 23 Mar

Usha Martin Education Solutions 29th AGM Notice FY26

Kalkine India, 08 Sept

Education Penny Stocks in India 2027: 5 Top Picks

Univest, 17 Sept

Usha Martin sells optical fibre manufacturing business to R R Kabel for Rs 77 crore

Business Standard, 25 Sept

DOVE SOFT LTD. Stock/Share price , NSE/BSE Forecast News and Live Quotes

Equitymaster, 08 Oct

Usha Martin Education & Solutions Share Price

Upstox, 26 Mar

Watch Items

Revenue growth is negative (-9.4%) 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 · Growth · Profitability

MiddlingFinancial Health · Valuation

WeakRisk

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.

All 5 tripwires holding · see Key things to watch ↑