1. At a Glance – Blink and You’ll Miss the Dividend
Expleo Solutions Ltd is that rare IT services company which quietly does the boring work (testing, validation, assurance) while paying you a fat 5.6% dividend for your patience. As of the latest close at ₹895, the company sits at a market cap of ~₹1,385 crore, trades at a P/E of ~11.8x, and still manages a ROCE of 21.5% with almost zero debt (D/E 0.03).
Q3 FY26 numbers came in spicy: revenue at ₹279 crore (+8.45% YoY) and PAT at ₹22.1 crore (+66.4% YoY). That’s not a typo. Profit grew faster than gossip on Twitter.
Yet, the stock is down ~25% over one year. So what’s going on? Is the market blind, or is Expleo just too boring to trend on Finfluencer reels? Let’s open the hood.
2. Introduction – The “Unsexy” IT Company Making Sexy Cash
In an industry obsessed with cloud buzzwords, AI hype, and 100x PE fantasies, Expleo Solutions Ltd is the uncle who shows up in chappals, speaks softly, and still pays everyone’s bill.
The company focuses on software validation, verification, and quality assurance, especially for BFSI, where mistakes are expensive and regulators have zero chill. You don’t want your core banking system to crash because someone rushed a deployment. That’s where Expleo comes in — checking, testing, breaking, and fixing systems before customers do it for free on social media.
What makes this interesting is not flashy growth but consistency. Over the last decade, Expleo has quietly compounded sales and profits, maintained high ROCE, and returned cash to shareholders. The market, meanwhile, seems more interested in loss-making SaaS dreams.
So the question is simple: Is boring back in fashion?
3. Business Model – WTF Do They Even Do?
Imagine you’re a bank launching a
new digital lending platform. You’ve spent crores building it. Now you’re terrified it might fail, leak data, or collapse under load on Day 1. Expleo’s job is to make sure that doesn’t happen.
What Expleo Actually Sells
- Quality Assurance & Testing – making sure software does what it claims
- Engineering Services – system validation, embedded systems testing
- Digital Transformation – helping legacy systems not die painfully
- Consulting & Advisory – compliance, risk, and process assurance
Where Money Comes From
- Professional services dominate revenue
- Small but growing contribution from proprietary tools & platforms in automation, AI analytics, and data governance
Client Reality Check
- 221 clients total
- Top 5 clients = 34% of revenue
- Top 10 clients = 54% of revenue
Yes, concentration risk exists. But in BFSI, long-term sticky clients are kind of the point. Would you rather test a bank for 10 years or chase 500 startups who vanish after Series A?
4. Financials Overview – Numbers Don’t Lie, Markets Do
EPS Annualisation
Q3 FY26 EPS = ₹14.26
Q1 FY26 EPS = ₹13.16
Q2 FY26 EPS = ₹25.62
Average EPS (Q1–Q3)
= (13.16 + 25.62 + 14.26) / 3
= ₹17.68
Annualised EPS = ₹17.68 × 4 = ~₹70.7
At CMP ₹895 → Effective P/E
