NETWEB - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 4.0

Let’s decode Netweb Technologies (NETWEB) — a high-performance computing and server solution provider riding on digital infrastructure growth 🚀🖥️

📘 Core Financials & Growth Indicators

Profitability Trends

PAT slipped from ₹42.6 Cr. to ₹30.5 Cr. this quarter, but still reflects 100% YoY profit variation — impressive.

EPS: ₹22.8 with a small equity base indicates strong per-share earnings.

ROE: 23.9% and ROCE: 32.4% — elite level returns, especially for a tech hardware player.

Balance Sheet Strength

Debt-to-Equity: 0.01 — virtually debt-free. That’s a fortress-like balance sheet.

Negligible dividend yield (0.09%) — reinvestment focus, typical for high-growth tech.

💸 Valuation Checkpoint

Indicator Value Insight

P/E Ratio 93.6 Richly valued vs. industry average of 32.0

P/B Ratio ~22.8 Elevated — implies high expectations

PEG Ratio 1.30 Acceptable given recent earnings expansion

Intrinsic Value ~₹1,850–₹2,000 Slightly overvalued at current market price

⚠️ Premium valuation needs to be justified by sustained growth and margin expansion.

🏢 Business Model & Competitive Advantage

Provides HPC (High-Performance Computing) solutions, servers, and enterprise storage — riding tailwinds of AI, analytics, and digital infrastructure adoption.

Operates in a niche segment with high switching costs and specialized demand — that’s its moat.

Institutional exits: FII (-1.13%) & DII (-1.11%)— may reflect short-term profit booking at lofty valuations.

📉 Technical Signals & Entry Recommendation

RSI: 68.3 — nearing overbought zone.

MACD: 49.7 — positive momentum still running hot.

Trading above DMA 50 (₹1,875) and DMA 200 (₹1,925) — technically bullish.

🎯 Suggested Entry Zone

Wait for pullback near ₹1,850–₹1,950 for margin of safety

Avoid chasing near highs (~₹2,135) unless momentum strategy is intentional

⏳ Long-Term Investment Outlook

✅ Exceptional ROCE/ROE, future-forward segment, debt-free

⚠️ High valuation and institutional trimming signal caution

🟢 Suitable for growth-oriented portfolios, especially those targeting India’s tech infrastructure boom

Want me to map it against peers like Sterlite Technologies, Tejas Networks, or global tech hardware firms for a deeper strategic comp? I’ve got just the matrix ready 🧮✨

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