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Check Before You Invest : Wherrelz IT Solutions Ltd

BSE: 543436 NSE: ISIN: INE0IM001015
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does Wherrelz IT Solutions Ltd belong to?
Wherrelz IT Solutions Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is Wherrelz IT Solutions Ltd a good quality company?
Wherrelz IT Solutions Ltd is a quality company, based on a 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 Wherrelz IT Solutions Ltd undervalued or overvalued?
Wherrelz IT Solutions Ltd appears Somewhat Undervalued, as its key valuation ratios are lower than 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 27.23 -
Price to Book -0.81 4.09
Price to Sales 0.31 8.20
EV to EBITDA 248.91 -5.32
Q.4 Is Wherrelz IT Solutions Ltd a good buy now?
Wherrelz IT Solutions Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. 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 Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd revenue growth is 24.2% for FY-2025, which is below its 5-year CAGR of 117.55%, indicating slower growth.

Q.2 Gross Profit margin of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Gross profit margin which is the profit after deduction of direct costs, is -83.3% for FY-2025, which is below its 5-year median of -3.4%, indicating decreasing margins.

Q.3 Operating Profit Margin of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is -83.28% for FY-2025, which is below its 5-year median of -12.11% indicating decreasing margins.

Q.4 Net Profit Margin of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Net Profit Margin is -83.4% for FY-2025, is below its 5-year median of -8.57%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) -83.3 -3.4
Operating Profit Margin (%) -83.28 -12.11
Net Profit Margin (%) -83.4 -8.57

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Return on Asset is -20.91%, which is below its 5-year historical median of -3.48%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Return on capital employed is -21.15% for FY-2025, which is below its 5-year historical median of -3.94%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Return on equity is 0% for FY-2025, which is below its 5-year historical median of 7.11%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Cash conversion cycle is -70 days, below its 5-year historical median of 3 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) 0.25 0.41
ROE (%) - 7.11
ROCE (%) -21.15 -3.94
Cash Conversion Cycle -70 days 3 days

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

Q.9 Debt to Equity ratio of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Debt-to-Equity ratio is -6.94, which is lower the industry average of 0.01, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Wherrelz IT Solutions Ltd?
Wherrelz IT Solutions Ltd Debt to cash flow from operations is -5.1, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Wherrelz IT Solutions Ltd?

Q.1 Promoter shareholding and pledge status of Wherrelz IT Solutions Ltd?
Promoters hold 20.53% of the Wherrelz IT Solutions Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Wherrelz IT Solutions Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Wherrelz IT Solutions Ltd vs industry peers?
Wherrelz IT Solutions Ltd revenue CAGR is 117.55%, compared to the industry median CAGR of 2.48%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 24.2 2.5
Gross Profit Growth (%) -6,969.2 18.3
Operating Profit Growth (%) -44,750 18
Net Profit Growth (%) -9,040 22
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.25 0.46
ROE (%) - 3.97
ROCE (%) -21.15 6.41
Cash Conversion Cycle (days) -70.03 36

Valuation & price assessment

Q.1 Stock return of Wherrelz IT Solutions Ltd over the last decade?
Over the last 3 year(s), the stock has delivered a CAGR of 0.88% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - 0.9% -34.1%
Q.2 Valuation ratios of Wherrelz IT Solutions Ltd vs historical?
The current P/E ratio of 27.23 is higher than its historical median of , indicating that the stock is trading above 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 27.23 - 47.38
Price to Book -0.81 4.09 2.64
Price to Sales 0.31 8.20 4.79
EV to EBITDA 248.91 -5.32 16.75

About MoneyWorks4Me

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