1. At a Glance – Blink and You’ll Miss the Turnaround
Datamatics Global Services Ltd is that rare IT company which quietly sits in the corner, does its job, generates cash like a disciplined baniya, and still gets ignored because it doesn’t shout “AI AI AI” on Twitter every 5 minutes. As of Q3 FY26, the company sports a market cap of ~₹3,942 crore, a CMP of ~₹667, and a P/E of ~18x, which in today’s frothy IT market is almost considered “undervalued uncle” territory.
Quarterly numbers? Revenue ₹510 crore (+19.9% YoY), PAT ₹59.3 crore (+31.1% YoY), and EBITDA up a mind-bending 76% YoY (yes, seventy-six). ROCE stands at a respectable 15%, ROE at 12.5%, debt-to-equity at a laughably safe 0.13, and net cash + investments hovering around ₹540–595 crore depending on which announcement you read last.
Stock performance, however, has been moody—-26% in 3 months, -31% in 6 months, proving once again that Mr Market doesn’t care about your Excel sheet in the short term. So the big question: is Datamatics quietly compounding while the market sulks, or is this another mid-cap IT name stuck in valuation purgatory?
2. Introduction – The IT Company That Refused to Become a Meme Stock
Datamatics has been around long enough to remember when IT meant “outsourcing + billing hours” and AI meant “Actually Indian”. Founded decades ago, it has evolved into a Digital Technologies, Digital Operations, and Digital Experiences company—which is consultant-speak for “we do IT, BPM, automation, analytics, and platforms, depending on what the client wants this quarter.”
Unlike flashy peers, Datamatics chose the boring but sensible route:
- Build own IP products
- Stay cash-rich
- Avoid reckless acquisitions (mostly)
- Keep promoter skin in the game (~66%)
This strategy didn’t make it a darling like some SaaS names, but it ensured survival, profitability, and optionality. Over the years, revenue growth was steady-but-not-sexy, margins were okay-ish, and the stock quietly compounded—until the recent correction reminded everyone that mid-cap IT stocks can fall faster than your internet during a Jio outage.
But Q3 FY26 numbers show something interesting: operating leverage is kicking in, margins are expanding, and
the company seems to be monetising its IP stack better than before. Is Datamatics finally entering its “late bloomer” phase?
3. Business Model – WTF Do They Even Do?
Let’s simplify this for the smart-but-lazy investor.
Datamatics operates across three broad buckets:
1) Digital Technologies (41% of Q3 FY24 revenue)
This includes IT services, cloud, analytics, AI/ML, and engineering services. Basically, your classic IT services with a digital makeover.
2) Digital Operations (43%)
This is BPM—document processing, finance & accounting, publishing services, and automation-heavy back-office work. This is where Datamatics flexes its TruCap+ and TruBot muscles.
3) Digital Experiences (16%)
CX, mobility solutions, and platforms like TruFare (used in metro rails and AFC systems). This segment is smaller but strategically interesting.
What makes Datamatics different is its IP-led strategy. Instead of being just a manpower supplier, it has built a full Intelligent Automation Platform combining:
- TruCap+ (Intelligent Document Processing)
- TruBot (RPA)
- TruBI (Analytics)
- TruAI (AI & cognitive solutions)
- FINATO (CFO back-office automation)
In theory, this gives Datamatics higher margins, stickier clients, and better scalability. In practice? Execution decides whether this becomes a moat or just a fancy PPT.
4. Financials Overview – Numbers Don’t Lie, But They Do Smirk
Quarterly Performance (Q3 FY26)
| Metric | Latest Qtr (Q3 FY26) | YoY Qtr (Q3 FY25) | Prev Qtr (Q2 FY26) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 510 | 425 | 490 | 19.9% | 4.1% |
| EBITDA (₹ Cr) | 96 | 54 | 89 | 76.4% | 7.9% |
| PAT (₹ Cr) | 59.3 | 45 | 63 | 31.1% | -5.9% |
| EPS (₹) | 6.16 | 7.59 | 10.70 | -18.8% | -42.4% |
Annualised EPS :
Q3 → Average of Q1, Q2, Q3 EPS × 4
= Avg
