At a Glance
SIS Ltd – the company that guards malls, banks, ATMs, and maybe your neighborhood too – posted Q1 FY26 revenue ₹3,549 Cr (+13.4% YoY) and PAT ₹93 Cr (+44.7% YoY). Margins remain thin (OPM 4%), and despite being a ₹5,500 Cr market cap player, it trades at a humble P/E of 17.5. Good? Yes. Exciting? Only if you like watching paint dry.
Introduction
Imagine a company whose core business is manned security – yes, guards in uniforms – but also does facility management and cash logistics. That’s SIS for you, a multi-vertical service provider operating across India, APAC, and ANZ.
Despite being a market leader, SIS has suffered from low growth (9% revenue CAGR over 5 years) and depressing ROE. But this quarter? The company decided to flex with 45% PAT growth – thanks to cost control and better execution. Whether it can sustain this momentum is the billion-rupee question.
Business Model (WTF Do They Even Do?)
SIS operates across three main verticals:
- Security Solutions (83%) – Manned guarding, electronic security, loss prevention, mobile patrols.
- Facility Management (12%) – Cleaning, housekeeping, pest control (basically janitors on steroids).
- Cash Logistics (5%) – Cash-in-transit, ATM replenishment, bullion transport.
This is a volume-driven business with razor-thin margins. Growth depends on contracts and scaling, not on some magical technology breakthrough.
Financials Overview
The company’s numbers for Q1 FY26 show a solid rebound:
- Revenue: ₹3,549 Cr (↑13.4% YoY)
- PAT: ₹93 Cr (↑44.7% YoY)
- EBITDA: ₹152 Cr (margin 4%)
- FY25 Revenue: ₹13,189 Cr (↑8% YoY)
- FY25 PAT: ₹12 Cr (ouch)
Verdict: This quarter looks strong, but FY25 was a disaster (PAT collapse). Investors need consistency, not quarterly miracles.
Valuation – Cheap for a Reason
- P/E Multiple Approach
- Industry P/E: ~20
- EPS (TTM): ₹2.81
- Fair Value ≈ 20 × 2.81 = ₹56 (but EPS is distorted by FY25 loss)
- EV/EBITDA
- EBITDA FY25: ₹298 Cr
- EV/EBITDA: 8× (industry average)
- EV ≈ ₹2,384 Cr → per share ≈ ₹300–₹320
- DCF (Basic)
- Growth 8%, discount 12%
- Intrinsic Value ≈ ₹350 – ₹400
🎯 Fair Value Range: ₹300 – ₹400, close to CMP ₹384. No screaming bargain, no crazy bubble.
What’s Cooking – News, Triggers, Drama
- Q1 FY26: Strong profit growth, revenue up double digits.
- Buyback Completed: Slightly shareholder-friendly.
- IPO for JV Approved: Could unlock value if executed well.
- Risk: FY25’s massive profit fall shows vulnerability.
- Opportunity: Growth in facility management and tech-based security.
Balance Sheet – Auditor’s Roast
| (₹ Cr) | Mar 23 | Mar 24 | Mar 25 |
|---|---|---|---|
| Assets | 5,670 | 5,938 | 6,081 |
| Liabilities | 3,336 | 3,732 | 3,673 |
| Net Worth | 2,260 | 2,341 | 2,336 |
| Borrowings | 1,647 | 1,658 | 1,645 |
Commentary: Assets stagnant, borrowings high. Net worth flat – meaning FY25 profits were basically non-existent.
Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Ops | 234 | 171 | 394 |
| Investing | -119 | -137 | -107 |
| Financing | -229 | -340 | -14 |
Commentary: Operating cash flows healthy, financing outflows dropping – good signs. Investing remains controlled.
Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 0.45% |
| ROCE | 5.47% |
| P/E | 17.5 |
| PAT Margin | 4% |
| D/E | 0.7 |
Commentary: ROE is pathetic, ROCE is low. Margins razor-thin. This is why the market yawns.
P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 11,346 | 12,261 | 13,189 |
| EBITDA | 492 | 519 | 298 |
| PAT | 346 | 190 | 12 |
Commentary: FY25 PAT collapse was brutal. Q1 FY26 recovery needs to hold for a turnaround story.
Peer Comparison
| Company | Rev (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| SIS | 13,608 | 41 | 17.5 |
| Exhicon Events | 144 | 20 | 26 |
| E Factor Exp. | 172 | 20 | 15.5 |
| Blue Pebble | 46 | 5 | 14.7 |
Commentary: SIS is huge compared to peers but trades at a low multiple because growth and returns are weak.
Miscellaneous – Shareholding, Promoters
Promoters hold a steady 72%. FIIs cut stake to 12.4%, DIIs small at 5.8%, public float minimal at 9.6%. Shareholding stable, but institutional confidence is lukewarm.
EduInvesting Verdict™
SIS is India’s security behemoth, but unlike Zomato or Adani, it doesn’t have the spice to excite traders. The business is stable, boring, and cash-generating – with thin margins and poor ROE.
Strengths:
- Largest security services player in APAC
- Stable cash flows, low P/E
- Diversified service portfolio
Weaknesses:
- Razor-thin margins
- FY25 PAT collapse shows fragility
- Poor ROE and ROCE
Opportunities:
- Facility management & electronic security growth
- IPO of JV could unlock value
- Overseas expansions
Threats:
- Wage inflation (security guards aren’t robots yet)
- Contract churn and pricing pressure
- Competition in low-margin industry
Final Take:
SIS is the “safe” stock in every sense – it won’t collapse overnight, but don’t expect fireworks either. Q1 FY26 looks like a comeback, but investors need to see consistent profit growth before clapping.
Written by EduInvesting Team | 30 July 2025SEO Tags: SIS Ltd, Security Services, Facility Management, Q1 FY26 Results
