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Check Before You Invest : Vdeal System Ltd

BSE: 0 NSE: VDEAL ISIN: INE0U2M01015
  |   Sector:  Capital Goods & Industrial Consumables   |   Industry:  Electric Equipment

Snapshot

Q.1 Which industry/sub-sector does Vdeal System Ltd belong to?
Vdeal System Ltd belongs to the Capital Goods & Industrial Consumables sector, operating specifically within the Electric Equipment segment.
Q.2 Is Vdeal System Ltd a good quality company?
Vdeal System 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 Vdeal System Ltd undervalued or overvalued?
Vdeal System 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 21.82 22.39
Price to Book 3.39 3.41
Price to Sales 2.59 2.66
EV to EBITDA 14 14.21
Q.4 Is Vdeal System Ltd a good buy now?
Vdeal System 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.

Q.1 Gross Profit margin of Vdeal System Ltd?
Vdeal System Ltd Gross profit margin which is the profit after deduction of direct costs, is 16.8% for FY-2025, which is above its 5-year median of 6.9%, indicating increasing margins.

Q.2 Operating Profit Margin of Vdeal System Ltd?
Vdeal System Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 20.59% for FY-2025, which is above its 5-year median of 11.95% indicating increasing margins.

Q.3 Net Profit Margin of Vdeal System Ltd?
Vdeal System Ltd Net Profit Margin is 11.88% for FY-2025, is above its 5-year median of 5.31%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 16.8 6.9
Operating Profit Margin (%) 20.59 11.95
Net Profit Margin (%) 11.88 5.31

B: Does the business utilize capital efficiently?

Q.4 Return on Asset of Vdeal System Ltd?
Vdeal System Ltd Return on Asset is 10.47%, which is above its 5-year historical median of 8.2%, indicating improved asset utilization efficiency.

Q.5 Return on capital employed (ROCE) of Vdeal System Ltd?
Vdeal System Ltd Return on capital employed is 25.56% for FY-2025, which is in line with its 5-year historical median of 25.25%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.6 Return on Equity (ROE) of Vdeal System Ltd?
Vdeal System Ltd Return on equity is 24.99% for FY-2025, which is in line with its 5-year historical median of 24.99%, indicating the business is making similar use of its shareholders capital.

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

Q.7 Debt to Equity ratio of Vdeal System Ltd?
Vdeal System Ltd Debt-to-Equity ratio is 0.42, which is above the industry average of 0.29, indicating higher debt levels in the industry.

Q.8 Debt to cash flow from operations of Vdeal System Ltd?
Vdeal System Ltd Debt to cash flow from operations is -0.78, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Vdeal System Ltd?

Q.1 Promoter shareholding and pledge status of Vdeal System Ltd?
Promoters hold 67.00% of the Vdeal System Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Vdeal System Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Vdeal System Ltd vs industry peers?
Vdeal System Ltd revenue CAGR is 0.00%, compared to the industry median CAGR of 13.01%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) - 13
Gross Profit Growth (%) 26.2 27.9
Operating Profit Growth (%) 25 28.4
Net Profit Growth (%) 28.3 28.5
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.88 1.06
ROE (%) 24.99 9.8
ROCE (%) 25.56 13.55
Cash Conversion Cycle (days) 209.6 99

Valuation & price assessment

Q.1 Stock return of Vdeal System Ltd over the last decade?
Over the last 1 year(s), the stock has delivered a CAGR of 22.89% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
- - - 22.9%
Q.2 Valuation ratios of Vdeal System Ltd vs historical?
The current P/E ratio of 21.82 is in line with than its historical median of 22.39, indicating that the stock is trading near 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 21.82 22.39 38.08
Price to Book 3.39 3.41 3.97
Price to Sales 2.59 2.66 2.75
EV to EBITDA 14 14.21 18.75

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