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INVESTMENT INSIGHTS

Check Before You Invest : Magellanic Cloud Ltd

BSE: 538891 NSE: MCLOUD ISIN: INE613C01026
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does Magellanic Cloud Ltd belong to?
Magellanic Cloud Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is Magellanic Cloud Ltd a good quality company?
Magellanic Cloud Ltd is a quality company, based on a 10 year financial track record.
Q.3 Is Magellanic Cloud Ltd undervalued or overvalued?
Magellanic Cloud Ltd appears Somewhat Undervalued, as its key valuation ratios are below with their past averages.
Q.4 Is Magellanic Cloud Ltd a good buy now?
Magellanic Cloud 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

Q.1 Revenue growth of Magellanic Cloud Ltd?
Magellanic Cloud Ltd revenue growth is 9.3% for FY-2025 , which is below its 5 year CAGR of 46.1% , indicating slower growth.
Q.2 Gross Profit margin of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Gross profit margin which is the profit after deduction of direct costs, is 27.1% for FY-2025 , which is below its 5 year median of 33.8% , indicating decreasing margins.
Q.3 Operating Profit Margin of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 50% for FY-2025 , which is above its 5 year median of 46.05% indicating increasing margins.
Q.4 Net Profit Margin of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Net Profit Margin is 16.73% for FY-2025 , is in line with with its 5 year median of 16.73%, indicating stable margins.
Current Level Historic Median
Gross Profit Margin 27.1 33.8
Operating Profit Margin 50 46.05
Net Profit Margin 16.73 16.73
Q.5 Return on Asset of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Return on Asset is 3.04(x), which is below its 5 year historical median of 4.25(x), indicating deteriorated asset utilization efficiency.
Q.6 Return on Equity (ROE) of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Return on equity is 6.79% for FY-2025 , which is below its historical median of 6.98%, indicating the business is making worse use of its shareholders capital.
Q.7 Return on capital employed (ROCE) of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Return on capital employed is 9.97% for FY-2025 , which is below its estimated weighted average cost of capital(WACC) 14%, indicating value preservation.
Q.8 Cash conversion cycle of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Cash conversion cycle is 71 , above its historical median of -59 , indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level Historic Median
Asset Turnover 0.18 0.23
ROE 6.79 6.98
ROCE 9.97 11.26
Cash Conversion Cycle 71 -59
Q.9 Debt to Equity ratio of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Debt-to-Equity ratio is 1.11 , which is above with the industry average of 0.01 , indicating higher debt levels in the industry.
Q.10 Debt to cash flow from operations of Magellanic Cloud Ltd?
Magellanic Cloud Ltd Debt to cash flow from operations is 91.05 , which is at a unhealthy level, indicating the business is not able to service its debt comfortably.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Magellanic Cloud Ltd?
Promoters hold 54.04% of the Magellanic Cloud Ltd, with 39.04% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Magellanic Cloud Ltd vs industry peers?
Magellanic Cloud Ltd revenue CAGR is 46.13% , compared to the industry median CAGR of 2.48% , indicating faster growth and gaining its market share.
Profit Metrics
Current Level Industry Median
Revenue 81.5 23.6
Gross Profit 22.2 1.9
Operating Profit 40 1.2
Net Profit 14 0.8
Operating Efficiency
Current Level Industry Median
Asset Turnover 0.18 0.45
ROE 6.79 4.09
ROCE 9.97 6.4
Cash Conversion Cycle 70.6 36

Valuation & price assessment

Q.1 Stock return of Magellanic Cloud Ltd over the last decade?
Over the last 9 years, the stock has delivered a CAGR of 2.7% based on the current price.
Q.2 What return has the stock given over the last decade?
9Y 5Y 3Y 1Y
Share Price 2.7% 51.5% -11.8% -56.1%
Q.3 Valuation ratios of Magellanic Cloud 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 83.63 57.66 22.96
Price to Book 6.03 3.73 2.61
Price to Sales 15.78 11.51 4.40
EV to EBITDA 32.13 30.50 17.20

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