At a Glance:
Incorporated in 1994 and still trying to find its product-market fit in 2025, Innovative Ideals and Services India Ltd started as a security system installer, dabbled in mobile phones, tied up with TATA Sky for broadband, and even managed to stay in the news for all the wrong reasons. From deeply negative profits to a miraculous ₹1 Cr profit in FY25, the only consistent part is their inconsistent performance.
🔍 1. WTF Do They Even Do?
- 💼 Claims to be a “system integrator” for:
- 🔐 Security systems
- 🚪 Video door phones (FERMAX distributor)
- 📡 Broadband via TATA Sky
- 🏢 Operates in B2B and B2C markets, but mostly B2B (Barely 2 Buyers?)
- 🧪 Business mix = Security, Internet, and vibes
🧠 Verdict: They do everything… except make money consistently.
📉 2. Financials – The Rollercoaster of Doom
| Year | Sales (₹ Cr) | Net Profit (₹ Cr) | OPM % | ROE % |
|---|---|---|---|---|
| FY21 | 3.5 | -5.87 | -200% | -ve |
| FY22 | 4.6 | -4.94 | -140% | -ve |
| FY23 | 3.6 | -7.24 | -100% | -ve |
| FY24 | 0.25 (!) | -2.46 | -1308% | -14% |
| FY25 | 3.2 | +1.0 | +27.3% | 27% |
🚨 From a ₹2.46 Cr loss on ₹25 lakhs in revenue last year… to ₹1 Cr profit on ₹3.2 Cr this year?
📢 Somebody give the CFO a Netflix deal. This plot twist is wilder than Sacred Games.
💸 3. Valuation – Innovation at an 8x Book Value?
- CMP: ₹30.4
- EPS FY25: ₹0.88
- P/E: 34.6x
- Book Value: ₹3.73
- P/B: 8.14x
- Market Cap: ₹34.6 Cr
🎯 Fair Value Range (based on 15–20x P/E if FY25 profit is real):
₹13 – ₹18
At current levels, the stock’s pricing assumes “innovation” but delivers mostly “ideals” — like government school textbooks.
🔍 4. What’s Cooking – From Dust to ₹1 Cr?
- 🧾 FY25 audited profit of ₹1 Cr — after 4 years of straight red ink
- ❗ Auditor issued a modified opinion – means “results dikhe toh sahi, par thoda doubt hai”
- 🧻 Debtor Days = 425 😳 — they give better credit terms than most private banks
- 🧢 Promoters only hold 16.05%, and 94.5% of that is pledged. So… 15% of 16% is basically borrowed swag
- 🧯 Tie-up with Tata Sky Broadband exists, but unclear if it adds meaningful revenue
📉 From ₹25 lakh sales to ₹3.2 Cr in 1 year smells like the company finally started sending invoices again — or maybe stopped canceling them.
🧾 5. Balance Sheet – More Fragile Than Their Broadband Signal
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Reserves (Cr) | -5.68 | -8.14 | -7.13 |
| Borrowings (Cr) | 18.1 | 19.6 | 19.8 |
| Net Worth | Negative for 3 straight years | ||
| Equity Capital | 11.38 | 11.38 | 11.38 |
👻 Their net worth was literally negative before this ₹1 Cr profit “saved” them.
🧠 One profit doesn’t erase 4 years of losses. It just gives you a break from explaining to your investors why your bank balance looks like your blood pressure.
💰 6. Cash Flow – Borrow → Bleed → Hope
| Year | CFO (₹ Cr) | FCF Verdict |
|---|---|---|
| FY21 | ₹3.89 | Borrowed relief |
| FY22 | -₹4.18 | Classic bleed |
| FY23 | -₹2.11 | More bleeding |
| FY25 | -₹0.19 | Still not stable |
No FCF. Ever. Just tiny moves and heavy borrowing.
🧮 7. Ratios – Deserve a Meme, Not a Metric
| Ratio | Value | Verdict |
|---|---|---|
| ROE FY25 | 26.7% | ONLY this year 🔁 |
| ROCE | 5.8% | Mildly alive 🟡 |
| OPM | 27.3% | Suspiciously high |
| D/E | 1.74x | Heavy debt alert 🚨 |
| Debtor Days | 425 | Worst in class |
This isn’t “working capital management.” It’s capital being held hostage.
📊 8. P&L Breakdown – Money from Where?
- FY25 Sales: ₹3.2 Cr
- Other Income: ₹0.51 Cr
- Net Profit: ₹1 Cr
- EPS: ₹0.88
- Dividend: 0%
TL;DR: ₹1 Cr profit includes ~₹50 lakh of “other income”. That’s not a clean win — that’s a band-aid on a bullet wound.
🥊 9. Peer Comparison – Not Even in the Same League
| Company | P/E | ROE | CMP/BV | MCap (₹ Cr) |
|---|---|---|---|---|
| CMS Info Systems | 22 | 17% | 3.5x | 8,078 |
| NESCO | 21 | 15% | 3x | 7,877 |
| Innovative | 35 | 27%* | 8.1x | 34.6 |
*Only because of one-off profit.
This is the equivalent of comparing your building’s watchman with Rohit Sharma because both “play cricket sometimes.”
🤝 10. Misc – Promoters, Public, and Punchlines
- 👥 Promoters: Just 16.05% — with 94.5% of that pledged
- 🧑🤝🧑 Public: 83.96%
- 🧾 Shareholders: 707 poor souls holding on for dear life
- 🛑 No mutual funds, no FIIs, not even a stray HNI
This is less of a stock and more of a Telegram pump-and-dump waiting to happen.
✅ EduInvesting Verdict™
From “Innovative” to “Ideally Avoidable”
They call themselves Innovative Ideals. The name is accurate:
- “Innovative”? Sure, for surviving 4 years of losses and still being listed.
- “Ideals”? Their promoters pledge stock like they’re playing poker.
- “Services”? Maybe.
- “India Ltd”? That’s the only legally accurate part.
🎯 Fair Value Range: ₹13 – ₹18 (generously assuming FY25 is not a fluke)
Not a buy/sell recommendation. This article is for educational and entertainment purposes — like the company itself.
✍️ Written by Prashant | 📅 June 30, 2025
Tags: Innovative Ideals and Services, SME penny stocks, FERMAX distributor India, Tata Sky Broadband tie-up, promoter pledge red flag, EduInvesting, funny stock analysis, security system stocks, SME turnaround stories, screener stock roast
