Vertoz Limited

Technology — Software - Infrastructure · NSE

₹33.48+₹1.19 (+3.69%)

DalalBaazaar Score

62 / 100

🟢 Good

Verdict

REASONABLE

Risk

High

Driven by negative free cash flow, micro-cap size, which brings thin liquidity, a beta above 1.3, so it swings harder than the index.

In simple words: Reasonable but unspectacular business quality, 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, 6:08 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Vertoz Limited operates as a digital advertising and media technology company that provides digital advertising, marketing, media, and monetization solutions in India.

IndustrySoftware - Infrastructure

SectorTechnology

Employees289

Annual revenue₹292 Cr

How does it make money?

Turns over ₹292 Cr a year. Of every ₹100 of sales, about ₹9 reaches shareholders as profit, with ₹18 left at the operating level before interest, tax and depreciation. Each of its 289 employees supports ₹1.01 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin18.3%

Net margin8.9%

Revenue / employee₹1.01 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.

TATA CONSULTANCY SERV LTP/E 17.3x · ROE 45.6%

INFOSYS LIMITEDP/E 15.8x · ROE 32.0%

HCL TECHNOLOGIES LTDP/E 20.4x · ROE 24.6%

WIPRO LTDP/E 14.5x · ROE 15.9%

What is its competitive advantage?Little sign of one

Returns on capital of 13.1% 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.

ROCE13.1%

ROE11.2%

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 +252% while net margin moved -33% 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+252%

Margin effect-33%

DalalBaazaar Score

62/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Beta of 1.45 — amplifies market moves in both directions
✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

62/ 100

Average

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

Valuation

88/ 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

10.4x

3Y Median

78.4x

40 monthly readings · mean 86.1x · range 0.8x–256.5x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 87% below its 3y median of 78.4x. 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 37% below the peer median of 16.5x.

vs. its own history

Cheap

78.4x median over 40 months · -87%

vs. sector peers

Cheap

16.5x median of 4 peers · -37%

vs. generic bands

Cheap

Below 15x

P/E (Trailing)

10.4x

P/B

1.32x

EV/EBITDA

6.8x

PEG

0.31

Dividend Yield

0.30%

What's Good / What's Bad

🟢 What's Going Well2

Valuation below its historical average
At 10.4x the stock trades 87% below its own median of 78.4x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Margins are compressing
EBITDA margin has slipped from 20.9% to 18.3% over 3 years.
Debt is rising
Total debt is up 881% over 3 years — worth checking what it funded.
Free cash flow is negative
The business is not currently covering its capital spending from operations.

Red Flags

4 items require attention · 1 high · 3 watch

🔴Debt has risen sharplyFinancial
Total debt is up 881% over 3 years, from ₹9 Cr to ₹88 Cr.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹16 Cr in the latest year.
🟡Margins are compressingFinancial
EBITDA margin is down 2.6 points over 3 years.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 256% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 87% 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.
Cheaper than its peers
It trades 37% 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?

Margins are being competed away
EBITDA margin has fallen from 20.9% to 18.3%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
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.

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

1Revenue growth stays above 39% a year✓ 52.2% CAGR
Latest reported year was 15.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 16%✓ 18.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹16 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 10%✓ 13.1%
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

6 good · 4 neutral · 1 weak

Market Cap

₹285 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

10.4x

Cheap

Cheap against the generic band

P/B Ratio

1.32x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹3.22

Profitable

Profitable on a per-share basis

ROE

11.2%

Moderate

Moderate capital efficiency

ROCE

13.1%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.39x

Low

Conservative leverage

Revenue Growth (YoY)

15.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

13.2%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.30%

Modest

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

Free Cash Flow

-₹16 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹33.48

Operating Margin

11.9%

Average

Average margins

Net Margin

8.7%

Average

Average bottom-line conversion

Current Ratio

1.54

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

1.45

High swing

Swings more than the market in both directions

52W Range Position

13%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

34.5 / 36.3

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

31.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹83 Cr	₹155 Cr	₹255 Cr	₹292 Cr	+52.2%
EBITDA	₹17 Cr	₹23 Cr	₹43 Cr	₹53 Cr	+45.6%
EBITDA Margin	20.9%	14.7%	17.0%	18.3%	—
PAT (Net Profit)	₹11 Cr	₹16 Cr	₹26 Cr	₹26 Cr	+33.2%
EPS	₹4.61	₹100.4	₹0.3	₹0.31	-59.3%
ROE	10.8%	9.9%	13.7%	11.2%	—
ROCE	14.5%	10.6%	15.4%	13.1%	—
Total Debt	₹9 Cr	₹17 Cr	₹21 Cr	₹88 Cr	+114.1%
Free Cash Flow	-₹16 Cr	-₹34 Cr	₹5 Cr	-₹16 Cr	—

🟢 Revenue has grown at 52.2% a year over 3 years.

🟢 EBITDA has grown at 45.6% a year over 3 years.

🔴 EBITDA Margin has fallen from 20.9% to 18.3% over 3 years (-2.6 pts).

🟢 PAT (Net Profit) has grown at 33.2% a year over 3 years.

🔴 EPS has shrunk at 59.3% a year over 3 years.

🟡 ROE has held roughly flat at 11.2% over 3 years.

🔴 ROCE has fallen from 14.5% to 13.1% over 3 years (-1.4 pts).

🔴 Total Debt has grown at 114.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹421 Cr

Total Liabilities

₹192 Cr

Total Debt

₹88 Cr

Cash & Equivalents

₹8 Cr

Operating Cash Flow

₹60 Cr

Capex

-₹75 Cr

Corporate Actions

Dividend Rate

₹0.1

Ex-Dividend Date

05 Jun 2026

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

1 mixed5 general

Vertoz Share Price Update: Fundamental and Sector Context

Univest, 08 Oct

We Think That There Are Some Issues For Vertoz (NSE:VERTOZ) Beyond Its Promising Earnings

Simply Wall Street, 08 JunResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

VERTOZ ADVERTISING Share Price

Upstox, 30 Dec

Vertoz promoters disclose share encumbrance status for FY26

scanx.trade, 30 Jun

Shankar Sharma sells 0.65% stake in ad-tech company

Moneycontrol.com, 08 Jun

Vertoz (VERTOZ.NS) Holds Near ₹38 After Modest Dip: Range-Bound Action Between ₹36.2 Support and ₹40.01 Resistance - Factor Rotation

siam.in, 09 Sept

Watch Items

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

DalalBaazaar Thesis

🟡Business QualityAdequate12/20

🟢Financial HealthStrong13/20

🟡GrowthModest12.9/20

🟡ProfitabilityModerate8.3/15

🟢ValuationAttractive13.2/15

🔴RiskHigh2.7/10

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. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 39% a year52.2% CAGR
✓EBITDA margin holds above 16%18.3%
✗Free cash flow remains positive-₹16 Cr
✓Debt / EBITDA stays below 2x1.7x
✓ROCE stays above 10%13.1%