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INVESTMENT INSIGHTS

Check Before You Invest : DRC Systems India Ltd

BSE: 543268 NSE: DRCSYSTEMS ISIN: INE03RS01027
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does DRC Systems India Ltd belong to?
DRC Systems India Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is DRC Systems India Ltd a good quality company?
DRC Systems India Ltd is a weak quality company, based on a inconsistent 10 year financial track record.
Q.3 Is DRC Systems India Ltd undervalued or overvalued?
DRC Systems India Ltd appears Fair, as its key valuation ratios are in line with their past averages.
Q.4 Is DRC Systems India Ltd a good buy now?
DRC Systems India Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of DRC Systems India Ltd?
DRC Systems India Ltd revenue growth is 18.1% for FY-2025 , which is below its 5 year CAGR of 31.3% , indicating slower growth.
Q.2 Gross Profit margin of DRC Systems India Ltd?
DRC Systems India Ltd Gross profit margin which is the profit after deduction of direct costs, is 17.2% for FY-2025 , which is above its 5 year median of 15.3% , indicating increasing margins.
Q.3 Operating Profit Margin of DRC Systems India Ltd?
DRC Systems India Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 16.94% for FY-2025 , which is above its 5 year median of 14.88% indicating increasing margins.
Q.4 Net Profit Margin of DRC Systems India Ltd?
DRC Systems India Ltd Net Profit Margin is 10.05% for FY-2025 , is above with its 5 year median of 6.53%, indicating increasing margins.
Current Level Historic Median
Gross Profit Margin 17.2 15.3
Operating Profit Margin 16.94 14.88
Net Profit Margin 10.05 6.53
Q.5 Return on Asset of DRC Systems India Ltd?
DRC Systems India Ltd Return on Asset is 8.95%, which is above its 5 year historical median of 5.93%, indicating improved asset utilization efficiency.
Q.6 Return on Equity (ROE) of DRC Systems India Ltd?
DRC Systems India Ltd Return on equity is 11.43% for FY-2025 , which is in line with its historical median of 11.43%, indicating the business is making similar use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of DRC Systems India Ltd?
DRC Systems India Ltd Return on capital employed is 13.35% for FY-2025 , which is below its estimated weighted average cost of capital(WACC) 14%, indicating value preservation.
Q.8 Cash conversion cycle of DRC Systems India Ltd?
DRC Systems India Ltd Cash conversion cycle is 60 days, above its historical median of 60 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 0.89 0.91
ROE 11.43 11.43
ROCE 13.35 9.31
Cash Conversion Cycle 60 days 60 days
Q.9 Debt to Equity ratio of DRC Systems India Ltd?
DRC Systems India Ltd Debt-to-Equity ratio is 0.00 , which is lower with the industry average of 0.01 , indicating lower debt levels in the industry.
Q.10 Debt to cash flow from operations of DRC Systems India Ltd?
DRC Systems India Ltd Debt to cash flow from operations is 0 , which is at a healthy level, indicating the business is able to service its debt comfortably.

Ownership & governance

Q.1 Promoter shareholding and pledge status of DRC Systems India Ltd?
Promoters hold 20.63% of the DRC Systems India Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of DRC Systems India Ltd vs industry peers?
DRC Systems India Ltd revenue CAGR is 31.28% , compared to the industry median CAGR of 2.48% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 42.4 23.6
Gross Profit 7.2 1.9
Operating Profit 7 1.2
Net Profit 4 0.8
Operating Efficiency
Current Level Industry Median
Asset Turnover 0.89 0.45
ROE 11.43 4.09
ROCE 13.35 6.4
Cash Conversion Cycle (days) 59.69 36

Valuation & price assessment

Q.1 Stock return of DRC Systems India Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of 9.09% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price - 9.1% 2.4% -36.2%
Q.3 Valuation ratios of DRC Systems India Ltd vs historical?
The current P/E is higher that its historical median.
Q.4 How do the current valuation ratios measure up against the historic numbers and the current industry numbers?
Valuation Ratios Current Historic Median Industry Median
Price to Earnings 52.82 40.59 22.96
Price to Book 3.28 5.38 2.61
Price to Sales 4.77 7.82 4.40
EV to EBITDA 27.16 24.80 17.20

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