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Check Before You Invest : AION-Tech Solutions Ltd

BSE: 531439 NSE: GOLDTECH ISIN: INE805A01014
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does AION-Tech Solutions Ltd belong to?
AION-Tech Solutions Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is AION-Tech Solutions Ltd a good quality company?
AION-Tech Solutions Ltd is a weak quality company, based on a inconsistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is AION-Tech Solutions Ltd undervalued or overvalued?
AION-Tech Solutions Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 16.63 115.71
Price to Book 0.78 3.43
Price to Sales 2.4 3.46
EV to EBITDA 31.62 65.87
Q.4 Is AION-Tech Solutions Ltd a good buy now?
AION-Tech Solutions Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd revenue growth is 9.9% for FY-2025, which is below its 5-year CAGR of 19.79%, indicating slower growth.

Q.2 Gross Profit margin of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Gross profit margin which is the profit after deduction of direct costs, is 5.2% for FY-2025, which is in line with its 5-year median of 5.2%, indicating stable margins.

Q.3 Operating Profit Margin of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 2.26% for FY-2025, which is below its 5-year median of 4.87% indicating decreasing margins.

Q.4 Net Profit Margin of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Net Profit Margin is 17.06% for FY-2025, is above its 5-year median of 3.37%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 5.2 5.2
Operating Profit Margin (%) 2.26 4.87
Net Profit Margin (%) 17.06 3.37

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Return on Asset is 14.26%, which is above its 5-year historical median of 3.03%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Return on capital employed is 25.19% for FY-2025, which is above its 5-year historical median of 6.41%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Return on equity is 20.88% for FY-2025, which is above its 5-year historical median of 4.67%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Cash conversion cycle is 26 days, below its 5-year historical median of 32 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.84 0.93
ROE (%) 20.88 4.67
ROCE (%) 25.19 6.41
Cash Conversion Cycle 26 days 32 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Debt-to-Equity ratio is 0.03, which is above the industry average of 0.01, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of AION-Tech Solutions Ltd?
AION-Tech Solutions Ltd Debt to cash flow from operations is -0.15, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of AION-Tech Solutions Ltd?

Q.1 Promoter shareholding and pledge status of AION-Tech Solutions Ltd?
Promoters hold 52.44% of the AION-Tech Solutions Ltd, with 3.24% of their stake pledged, indicating low pledge risk.

Peer comparison (industry-wise, mcap)

E: How does AION-Tech Solutions Ltd performance compare with that of its Peers?

Q.1 Revenue growth of AION-Tech Solutions Ltd vs industry peers?
AION-Tech Solutions Ltd revenue CAGR is 19.79%, compared to the industry median CAGR of 3.17%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 9.9 3.2
Gross Profit Growth (%) 25 18.4
Operating Profit Growth (%) -50 18.8
Net Profit Growth (%) 650 21.9
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.84 0.46
ROE (%) 20.88 4.22
ROCE (%) 25.19 6.49
Cash Conversion Cycle (days) 25.6 36

Valuation & price assessment

Q.1 Stock return of AION-Tech Solutions Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 22.5% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
22.5% 34.2% -11.7% -29%
Q.2 Valuation ratios of AION-Tech Solutions Ltd vs historical?
The current P/E ratio of 16.63 is lower than its historical median of 115.71, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 16.63 115.71 47.38
Price to Book 0.78 3.43 2.64
Price to Sales 2.4 3.46 4.79
EV to EBITDA 31.62 65.87 16.75

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