SAGILITY - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:16 pm

Fundamental Rating: 2.9

📊 Financials: Sagility has a market cap of ₹24,352 Cr. Current price is ₹52 with a 52-week high/low of ₹57.9/₹37.6. PAT this quarter is ₹111 Cr vs ₹96.7 Cr in the previous quarter, showing growth. ROCE at 4.37% and ROE at 2.88% reflect weak efficiency. Debt-to-equity ratio of 0.09 indicates very low leverage.

💹 Valuation: Stock P/E is 61.0, nearly double the industry PE of 31.6, suggesting overvaluation. Book value is ₹22.1, giving a P/B ratio of ~2.35. PEG ratio at 0.20 indicates some growth support but still expensive relative to earnings. EPS is only ₹0.85, highlighting limited profitability.

🏭 Business Model: Sagility operates in healthcare BPO and outsourcing services. The company’s competitive advantage lies in domain expertise and cost efficiency, but margins remain thin compared to peers. Business model is scalable but highly dependent on client contracts and global outsourcing trends.

📈 Entry Zone: Technically, DMA 50 (₹49) and DMA 200 (₹45) suggest support zones. Entry is favorable near ₹45–₹49 if price corrects. Current RSI at 55.9 indicates neutral momentum.

🕰️ Long-Term Holding: Weak return ratios and high valuation limit attractiveness for long-term compounding. Investors should wait for correction closer to intrinsic value zones before accumulating.

Positive

• ✅ Low debt-to-equity ratio (0.09)
• ✅ Quarterly PAT growth (96.7 Cr → 111 Cr)
• ✅ DII holding increased (+0.80%)

Limitation

• ⚠️ High P/E (61.0) vs industry PE (31.6)
• ⚠️ Weak ROCE (4.37%) and ROE (2.88%)
• ⚠️ EPS only ₹0.85

Company Negative News

• 📉 FII holding reduced (-0.40%)
• 📉 Thin profit margins despite revenue growth

Company Positive News

• 📈 Strong quarterly profit variation (+51.4%)
• 📈 Healthcare outsourcing demand remains robust

Industry

• 🏭 Healthcare BPO industry growing with global outsourcing trends
• 🏭 Industry PE at 31.6 highlights Sagility’s premium valuation

Conclusion

🔎 Sagility shows growth momentum but suffers from weak return ratios and stretched valuations. Entry zone lies near ₹45–₹49. Long-term investors should be cautious and accumulate only on significant corrections, while traders may exploit short-term momentum.

Would you like me to extend this with a peer benchmarking overlay against other healthcare BPO firms, or a sector scan to highlight undervalued outsourcing companies?