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Check Before You Invest : Route Mobile Ltd

BSE: 543228 NSE: ROUTE ISIN: INE450U01017
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does Route Mobile Ltd belong to?
Route Mobile Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is Route Mobile Ltd a good quality company?
Route Mobile 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 Route Mobile Ltd undervalued or overvalued?
Route Mobile Ltd appears 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 25.8 100.12
Price to Book 2.62 7.59
Price to Sales 4.52 16.58
EV to EBITDA 14.18 60.83
Q.4 Is Route Mobile Ltd a good buy now?
Route Mobile 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 Route Mobile Ltd?
Route Mobile Ltd revenue growth is 24.8% for FY-2025, which is above its 5-year CAGR of 15.4%, indicating faster growth.

Q.2 Gross Profit margin of Route Mobile Ltd?
Route Mobile Ltd Gross profit margin which is the profit after deduction of direct costs, is 25.9% for FY-2025, which is above its 5-year median of 24.2%, indicating increasing margins.

Q.3 Operating Profit Margin of Route Mobile Ltd?
Route Mobile Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 14.33% for FY-2025, which is above its 5-year median of 8.75% indicating increasing margins.

Q.4 Net Profit Margin of Route Mobile Ltd?
Route Mobile Ltd Net Profit Margin is 15.74% for FY-2025, is in line with its 5-year median of 15.74%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 25.9 24.2
Operating Profit Margin (%) 14.33 8.75
Net Profit Margin (%) 15.74 15.74

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Route Mobile Ltd?
Route Mobile Ltd Return on Asset is 8.66%, which is above its 5-year historical median of 6.95%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Route Mobile Ltd?
Route Mobile Ltd Return on capital employed is 14.19% for FY-2025, which is in line with its 5-year historical median of 13.64%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 13.5%, indicating value creation.

Q.7 Return on Equity (ROE) of Route Mobile Ltd?
Route Mobile Ltd Return on equity is 10.97% for FY-2025, which is in line with its 5-year historical median of 10.66%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Route Mobile Ltd?
Route Mobile Ltd Cash conversion cycle is -25 days, in line with its 5-year historical median of -25 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) 0.55 0.51
ROE (%) 10.97 10.66
ROCE (%) 14.19 13.64
Cash Conversion Cycle -25 days -25 days

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

Q.9 Debt to Equity ratio of Route Mobile Ltd?
Route Mobile Ltd Debt-to-Equity ratio is 0.00, 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 Route Mobile Ltd?
Route Mobile Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Route Mobile Ltd?

Q.1 Promoter shareholding and pledge status of Route Mobile Ltd?
Promoters hold 74.85% of the Route Mobile Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Route Mobile Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Route Mobile Ltd vs industry peers?
Route Mobile Ltd revenue CAGR is 15.40%, 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 (%) 24.8 3.2
Gross Profit Growth (%) 24.3 18.4
Operating Profit Growth (%) 58.7 18.8
Net Profit Growth (%) 4 21.9
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.55 0.46
ROE (%) 10.97 4.22
ROCE (%) 14.19 6.49
Cash Conversion Cycle (days) -25.12 36

Valuation & price assessment

Q.1 Stock return of Route Mobile Ltd over the last decade?
Over the last 5 year(s), the stock has delivered a CAGR of -19.24% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- -19.2% -24.6% -39.5%
Q.2 Valuation ratios of Route Mobile Ltd vs historical?
The current P/E ratio of 25.8 is lower than its historical median of 100.12, 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 25.8 100.12 47.38
Price to Book 2.62 7.59 2.64
Price to Sales 4.52 16.58 4.79
EV to EBITDA 14.18 60.83 16.75

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