1. At a Glance
Kapston Services Ltd just clocked ₹212 Cr in Q3 FY26 revenue, up 16.4% YoY, while PAT jumped 62.9% to ₹7.38 Cr. On paper, this looks like a classic midcap services success story — steady demand, diversified clientele, and promoters holding a tight 72.9% grip on the company.
But let’s not get carried away and start distributing laddoos yet.
At ₹414 per share, Kapston trades at a P/E of ~31.7, 8.26× book value, with an OPM of just ~5%. This is a company that hires people, manages people, and bills people — not exactly a SaaS rocket ship. Yet the stock has delivered ~67% return in 6 months and ~39% in 3 months.
So the obvious question:
👉 Is this operational execution finally kicking in, or is the market just having a manpower-stock sugar rush?
2. Introduction
Kapston Services is not flashy. It doesn’t sell apps, chips, or AI dreams. It sells human beings’ time — security guards, housekeeping staff, electricians, IT contractors, payroll-managed employees, and basically everyone who keeps large organisations running without headlines.
Founded in 2009, Kapston operates in the Facility Management and Staffing space — a sector where margins are thin, receivables are slow, and execution discipline matters more than PowerPoint presentations.
Yet here we are in FY26, with Kapston showing:
- 3-year sales CAGR: ~36%
- TTM profit growth: ~82%
- ROE: ~22%
That’s not accidental. That’s operational scale finally starting to show.
But there’s a twist:
This growth is funded with debt, not magic.
So before we crown Kapston as the next multi-bagger janitor-turned-king, let’s open the books and read between the lines.
3. Business Model – WTF Do They Even Do?
Kapston runs a people-heavy, contract-driven services business. Think of it as the HR + Admin department outsourced at scale.
What Kapston Actually Sells
- Security services (guards, surveillance, canine units)
- Housekeeping & soft services (cleaning, pest control, landscaping)
- Technical services (electrical, plumbing, maintenance)
- General & IT staffing (contract staff, payroll management, RPO)
Revenue Mix (FY23)
- Security services: ~40%
- Housekeeping: ~30%
- Contract staffing: ~30%
This is not a “winner takes all” business. It’s a scale + compliance + execution game. Whoever can:
- Recruit faster
- Retain staff
- Manage payroll
- Collect money on time
…wins.
And Kapston seems to be doing that better lately.
But remember:
👉 Every additional ₹1 of revenue also brings salaries, uniforms, PF, ESI, logistics, and compliance headaches.
Margins don’t expand easily here.
4. Financials Overview (Q3 FY26 – Quarterly Results Locked)
Quarterly Comparison Table (₹ Cr)
| Metric | Latest Qtr (Dec FY26) | YoY Qtr | Prev Qtr | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 212.04 | 182.20 | 209.89 | 16.4% | 1.0% |
| EBITDA | 11.16 | 8.01 | 9.91 | 39.3% | 12.6% |
| PAT | 7.38 | 4.53 | 7.02 | 62.9% | 5.1% |
| EPS (₹) | 3.64 | 2.23 | 3.46 | 63.2% | 5.2% |
Average of Q1, Q2, Q3 EPS × 4 ≈ ₹13.1
👉 That’s exactly what the TTM EPS shows. No jugaad. Clean math.
Commentary:
Revenue growth is steady, but the real story is operating leverage finally showing up. EBITDA margins crossed 5%, which in this business is like finding AC in a government office.
5. Valuation Discussion – Fair Value Range Only
Let’s be boring and responsible.
Method 1: P/E Multiple
- Annualised EPS: ₹13.1
- Reasonable sector
