1. At a Glance
Alphalogic Techsys (ATL) is that rare IT company which thought, “Why stop at apps when we can also make alcohol?” Yes, alongside its boutique digital services (AI, cloud, app dev), it is setting up abio-ethanol distilleryin Maharashtra. Investors who signed up for coding margins are now stuck with brewing margins. Current P/E? 124. Current PAT growth? Flat like a stale dosa.
2. Introduction
Founded in 2018, Alphalogic built itself as a nimble “digital transformation” shop. Healthcare, SaaS, fintech — ATL got clients like Mahindra, Saint Gobain, Bajaj Finserv, and even Swiggy (hopefully not for developing a “late food delivery excuses” app).
For a while, life was sweet: sales grew 76% CAGR in 5 years, PAT also grew respectably. Then FY25 arrived: sales ₹65 Cr (down 16% YoY), PAT ₹4.7 Cr (down 10%). The IPO buzz of its subsidiary Alphalogic Industries (storage racks) helped sentiment, but the core IT business looks tired.
Now comes the ethanol detour: a₹136 Cr loansanctioned for a 1.5 lakh LPD distillery + power co-gen unit. This is either visionary diversification or mid-life crisis disguised as diversification.
So, is Alphalogic an IT phoenix or an ethanol experiment gone wild?
3. Business Model (WTF Do They Even Do?)
Alphalogic is like that friend who can code a website, edit your wedding photos, and still wants to open a brewery.
IT Services:
- App Dev (mobile/web):Android, iOS, portals, e-commerce
- UI/UX design:Mock-ups, dashboards, “let’s copy Apple aesthetic”
- DevOps:CI/CD, automation, “push to prod and pray” services
- BI & Analytics:Reporting dashboards nobody opens after first login
- Cloud Consulting:AWS, Azure, GCP – basically rent servers and bill clients
- AI Consulting:AI strategy, process automation (aka “ChatGPT wrapper” business)
Verticals:
- Healthcare:Mobility, patient engagement apps
- SaaS:Architecture & prototyping
- Fintech:Banking apps, UI for wallets
New Bet:
- Bio-Ethanol Distillery (MIDC Tadali, Chandrapur):1.5 lakh LPD, plus DDGS & CO₂ as by-products, 3.3
- MW power co-gen.
So ATL is half Infosys (tiny version), half Praj Industries (wannabe).
4. Financials Overview
| Metric | Latest Qtr (Jun’25) | YoY Qtr (Jun’24) | Prev Qtr (Mar’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 11.4 | 23.8 | 14.6 | -52% | -22% |
| EBITDA (₹ Cr) | 1.68 | 1.76 | 1.70 | -4.5% | -1% |
| PAT (₹ Cr) | 1.61 | 1.73 | 1.22 | -7% | +32% |
| EPS (₹) | 0.19 | 0.20 | 0.17 | — | — |
Annualised EPS (FY25): ₹0.76CMP ₹93.8 →P/E = 124xEV/EBITDA = 66x
Commentary: Alphalogic is trading like Persistent Systems, but with revenue the size of one TCS tea bill.
👉 Question: Would you pay 124x earnings for a ₹65 Cr revenue IT mini-firm pivoting into ethanol?
5. Valuation (Fair Value Range)
(a) P/E Method
Industry PE ~30. EPS ₹0.76 → FV = ₹23.Even if profits double to ₹10 Cr (EPS ~1.6), FV = ₹48.
(b) EV/EBITDA Method
EBITDA FY25 = ₹6.8 Cr. At 15–20x = ₹100–135 Cr EV.Current EV = ₹588 Cr → overpriced 4–5x.
(c) DCF (optimistic, assume 20% growth IT + ethanol ramp-up in FY27)
FV range = ₹35–₹60.
🎯Fair Value Range (Educational Only): ₹23 – ₹60(Disclaimer: Not investment advice.)
6. What’s Cooking – News, Triggers, Drama
- Ethanol Plant:₹136 Cr loan approved, statutory approvals in place.
