1. At a Glance
Oracle’s fintech arm in India is serving software with 45% margins and 99% dividend payout. Flexcube might be their product, but cash cube is the real vibe.
2. Introduction with Hook
If Oracle OFSS were a cricketer, it’d be Rahul Dravid with Dhoni’s dividend policy—technically sound, boringly stable, and always giving back. A steady, cash-generating IT product play that doesn’t chase moonshots but delivers consistent runs.
- Operating Margin? A whopping 45%
- ROCE? 41%
- Dividend payout? 99%+
- Valuation? Just 32x P/E, while peers go loony at 60–100x
3. Business Model (WTF Do They Even Do?)
One-word description: Banking Software
Long version: OFSS sells enterprise software products & services for financial institutions. Core banking, risk, payments, lending, digital onboarding—it’s all Flexcube’d.
- Product Revenue (91%) – Oracle Flexcube, Oracle Banking Platform
- Services (9%) – IT infra & consulting
- Clients: Banks, NBFCs, insurance, and capital markets worldwide
- 1,800+ APIs in their kit (fintech bros would call this “modular”)
4. Financials Overview
| ₹ Cr | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Sales | 5,221 | 5,698 | 6,373 | 6,847 |
| EBITDA | 2,499 | 2,471 | 2,782 | 3,076 |
| Net Profit | 1,889 | 1,806 | 2,219 | 2,380 |
| OPM % | 48% | 43% | 44% | 45% |
| EPS (₹) | 219 | 209 | 256 | 274 |
Steady climb. Boring? Sure. But also bankable.
5. Valuation
- CMP ₹8,775
- TTM EPS ₹274
- P/E = 32x
- Book Value ₹963 → P/B = 9.1x
- Dividend Yield = 3.02%
Method 1: P/E-based (25x–35x)
FV = ₹6,850 – ₹9,600
Method 2: Dividend Discount Model (₹250 DPS, 10% CoE)
FV = ₹8,200 – ₹9,300
Fair Value Range: ₹6,850 – ₹9,600
CMP = Reasonable (Unlike its tech peers who are hallucinating)
6. What’s Cooking – News, Triggers, Drama
- Q4FY25 EPS ₹74 → annualized ₹296
- Cloud license revenue up 30% over 2 years
- CEO change – New MD/CFO duo from Oracle HQ as of Oct 2023
- 120+ deals signed in FY25 – Global BFSI clients still love legacy
- Cash pile growing even after dividends
7. Balance Sheet
| Item | FY25 |
|---|---|
| Equity Capital | ₹43 Cr |
| Reserves | ₹8,319 Cr |
| Borrowings | ₹46 Cr |
| Total Assets | ₹10,067 Cr |
| Net Block | ₹796 Cr |
| Investments | NIL |
| Cash & Equiv | ₹2,500+ Cr |
Takeaway:
No debt. Big reserves. ₹2,000+ Cr in the bank. Textbook balance sheet of a dividend ATM.
8. Cash Flow – Sab Number Game Hai
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| CFO | 1,758 | 1,791 | 2,199 |
| CFI | 267 | 1,611 | -2,372 |
| CFF | -1,665 | -1,958 | -2,096 |
| Net Cash Flow | ₹360 | ₹1,443 | ₹-2,269 |
Massive dividend outflows, but also reinvestment into cloud infra. They’re not hoarding cash—they’re flexing it.
9. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROCE % | 35% | 40% | 41% |
| ROE % | 27% | 28% | 29% |
| OPM % | 43% | 44% | 45% |
| P/E | 31x | 28x | 32x |
| Div. Payout | 108% | 94% | 97% |
Verdict:
Sexy as hell if you like stability. Boring if you want chaos and VC-esque returns.
10. P&L Breakdown – Show Me the Money
| ₹ Cr | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|
| Revenue | 5,221 | 5,698 | 6,373 | 6,847 |
| EBITDA | 2,499 | 2,471 | 2,782 | 3,076 |
| Net Profit | 1,889 | 1,806 | 2,219 | 2,380 |
| OPM % | 48% | 43% | 44% | 45% |
| EPS ₹ | 219 | 209 | 256 | 274 |
Consistency so smooth, you could bottle it as a moisturiser.
11. Peer Comparison
| Company | CMP ₹ | P/E | ROCE % | OPM % | EPS ₹ | Sales ₹ Cr |
|---|---|---|---|---|---|---|
| OFSS | ₹8,775 | 32 | 41% | 45% | ₹274 | ₹6,847 |
| Tanla | ₹645 | 17 | 29% | 17% | ₹24 | ₹4,027 |
| Nucleus Soft | ₹1,140 | 22 | 22% | 20% | ₹64 | ₹832 |
| CE Info (MapmyIndia) | ₹1,803 | 76 | 24% | 38% | ₹127 | ₹463 |
Verdict:
Best margins, best ROCE, decent valuation. Not sexy, but elite. Like Tata Tech in a suit.
12. Miscellaneous – Shareholding, Promoters
| Holder | Mar 2025 |
|---|---|
| Promoter (Oracle Mauritius) | 72.59% |
| FII | 8.74% |
| DII | 8.69% |
| Public | 9.97% |
| Total Shareholders | 1.25 Lakh+ |
FII/DII increasing again in FY25. Promoter stable above 72%. Solid institutional backing = sleep well stock.
13. EduInvesting Verdict™
Oracle OFSS isn’t a moonshot—it’s a cash-generating software satellite on autopilot. With margins that make SaaS companies jealous, and a dividend payout your grandma would approve of, it’s quietly compounding away.
While others are chasing growth, OFSS is flexing Flexcube and compounding like a monk with a money printer.
Metadata
– Written by EduInvesting Research Desk | July 15, 2025
– Tags: Oracle Financial Services, OFSS, Flexcube, Dividend Software Stocks, IT Products, ROCE Kings, SaaS India
