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Check Before You Invest : Leapfrog Engineering Services Ltd

BSE: 544797 NSE: ISIN: INE0X6O01027
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Engineering

Snapshot

Q.1 Which industry/sub-sector does Leapfrog Engineering Services Ltd belong to?
Leapfrog Engineering Services Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Engineering segment.
Q.2 Is Leapfrog Engineering Services Ltd a good quality company?
Leapfrog Engineering Services Ltd is a average quality company, based on a somewhat consistent 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 Leapfrog Engineering Services Ltd undervalued or overvalued?
Leapfrog Engineering Services Ltd appears Overvalued, as its key valuation ratios are higher 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 16.3 -
Price to Book 2.4 -
Price to Sales 2.1 -
EV to EBITDA 9.69 -
Q.4 Is Leapfrog Engineering Services Ltd a good buy now?
Leapfrog Engineering Services 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 Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd revenue growth is -14.7% for FY-2025, which is below its 5-year CAGR of 101.34%, indicating slower growth.

Q.2 Gross Profit margin of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Gross profit margin which is the profit after deduction of direct costs, is 16.6% for FY-2025, which is above its 5-year median of 3.8%, indicating increasing margins.

Q.3 Operating Profit Margin of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 17% for FY-2025, which is above its 5-year median of 6.99% indicating increasing margins.

Q.4 Net Profit Margin of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Net Profit Margin is 12.05% for FY-2025, is above its 5-year median of 2.82%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 16.6 3.8
Operating Profit Margin (%) 17 6.99
Net Profit Margin (%) 12.05 2.82

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Return on Asset is 16.28%, which is above its 5-year historical median of 2.23%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Return on capital employed is 46.05% for FY-2025, which is above its 5-year historical median of 15.62%. 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 Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Return on equity is 43.28% for FY-2025, which is above its 5-year historical median of 16.14%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Cash conversion cycle is 66 days, in line with its 5-year historical median of 66 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.35 1.35
ROE (%) 43.28 16.14
ROCE (%) 46.05 15.62
Cash Conversion Cycle 66 days 66 days

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

Q.9 Debt to Equity ratio of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Debt-to-Equity ratio is 0.38, which is above the industry average of 0.27, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Leapfrog Engineering Services Ltd?
Leapfrog Engineering Services Ltd Debt to cash flow from operations is -1.05, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Leapfrog Engineering Services Ltd?

Q.1 Promoter shareholding and pledge status of Leapfrog Engineering Services Ltd?
Promoters hold 67.26% of the Leapfrog Engineering Services Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Leapfrog Engineering Services Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Leapfrog Engineering Services Ltd vs industry peers?
Leapfrog Engineering Services Ltd revenue CAGR is 101.34%, compared to the industry median CAGR of 0.00%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -14.7 0
Gross Profit Growth (%) -8.3 15.7
Operating Profit Growth (%) 9.5 16.8
Net Profit Growth (%) - 24.6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.35 0.73
ROE (%) 43.28 8.68
ROCE (%) 46.05 11.86
Cash Conversion Cycle (days) 65.56 79

Valuation & price assessment

Q.1 Stock return of Leapfrog Engineering Services Ltd over the last decade?
Over the last - year(s), the stock has delivered a CAGR of N/A% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - -
Q.2 Valuation ratios of Leapfrog Engineering Services Ltd vs historical?
The current P/E ratio of 16.3 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 16.3 - 29.42
Price to Book 2.4 - 2.38
Price to Sales 2.1 - 2.22
EV to EBITDA 9.69 - 15.76

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