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MomentumDeep Value

Which IT Product Companies Stocks Are Deep Value Picks in Week of May 10, 2026?

In the Week of May 10, 2026, the IT Product Companies sector has 2 stocks that are underperforming Nifty 500 but have accelerating quarterly earnings. Average value score is 51/100 with PAT acceleration of +5pp.

Total Stocks
2
deep value
Avg Fundamental
51
/100
Top Pick
Zaggle
Score: 50/100
Avg Margin of Safety
Undervalued

Stock Distribution

0 Strong0 Good2 Average0 Weak

Earnings & Valuation Signals

🔄

1 turnaround: Network People Services Technologies Ltd

⚠️

1 stock flagged for margin pressure — profits may not sustain.

💰

2 of 2 stocks trading below fair value — sector offers value opportunities.

AI Research Summary

Sector Pulse

The IT Product sector is demonstrating high-velocity growth as digital payment infrastructure and spend management platforms scale. NPST reported a 145% YoY revenue increase to ₹57.17 Cr, while Zaggle achieved a record ₹498 Cr, up 47.9% YoY. Despite NPST missing its internal ₹67 Cr target due to order spillovers, the underlying demand remains improving, particularly in the Technology Service Provider (TSP) segment which now dominates NPST's mix at 85-90%.

Catalysts Playing Out Across the Pack

Operating leverage inflection via AI is the primary catalyst. NPST is targeting a 40% optimization in delivery mandates, while Zaggle has already 'considerably downsized' its IT team to leverage AI efficiencies. Geographical expansion is the second major theme; NPST is in discussions with 10 to 11 countries, and Zaggle is establishing a presence in the GCC region via Abu Dhabi and UAE. New product launches, such as NPST's PPI and Zaggle's ZAG.money, are expected to create high-value revenue streams, with Zaggle targeting INR 500 Cr from its retail pillar in 4-5 years.

What Managements Are Guiding

Managements remain confident, reaffirming all forward targets. Zaggle is maintaining its 40% to 45% organic revenue growth guidance and a long-term adjusted EBITDA margin goal of 14% to 15%. NPST is guiding for 15% to 20% sequential growth in Q4 FY26, expecting to hit all-time highs as delayed orders materialize. Capex is being directed toward platform scalability, with Zaggle earmarking over INR 100 Cr for its retail segment.

Sub-Sector Aggregates

Aggregate metrics reveal a sector in a high-growth phase, with YoY revenue growth ranging from 47.9% to 145%. EBITDA margins show a wide range (10.2% to 32.8%), reflecting different business models—NPST's bank-led infrastructure vs. Zaggle's platform-based spend management. Notably, 100% of analyzed constituents are now using AI as a primary lever for operational efficiency and headcount management.

Shared Risks (9-type taxonomy)

Regulatory risks are the most prominent, with NPST facing technical observations on IPO fund usage and Zaggle monitoring draft income tax rules for 2026. Labor risks are categorized as low, with both firms proactively managing the transition to AI-led delivery. No significant geopolitical or FX risks were highlighted this quarter despite the global expansion plans.

Bottom Line

The sector is successfully transitioning from a domestic-only focus to a global product play, supported by high-magnitude PAT growth (77.7% to 124% YoY). While regulatory technicalities require monitoring, the aggressive pursuit of operating leverage through AI and international expansion provides a clear path for margin expansion.

Last updated Apr 19, 2026

2 stocks in this sector

View:
Average59/100

Network People Services Technologies Ltd

2.6K Cr
Undervalued
Earnings Pulse
PAT YoY
+140%
Turnaround
Revenue YoY
+152%
Momentum
Fading
▼
Margin Pressure
Average42/100

Zaggle Prepaid Ocean Services Ltd

3.5K Cr
Deeply Undervalued
Earnings Pulse
PAT YoY
+85%
Stable
Revenue YoY
+56%
Momentum
Fading
▼

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Frequently Asked Questions: IT Product Companies

Based on publicly available financial data. This is educational research, not investment advice.

How many IT Product Companies stocks are deep value opportunities worth studying?

There are currently 2 stocks in the IT Product Companies sector that qualify as deep value opportunities worth studying. These stocks are underperforming the market despite showing improving earnings — a classic contrarian research signal.

Which IT Product Companies deep value stocks appear most undervalued?

The most undervalued IT Product Companies deep value stocks based on fair value analysis

  • Network People Services Technologies Ltd — Slightly Undervalued
  • Zaggle Prepaid Ocean Services Ltd — Slightly Undervalued
  • Stocks sorted by valuation signal (most undervalued first).

Which IT Product Companies deep value stock has the highest earnings acceleration?

IT Product Companies deep value stocks with the highest earnings growth

  • Network People Services Technologies Ltd — PAT growth +140.0% YoY, earnings turning around (inflection up)
  • Zaggle Prepaid Ocean Services Ltd — PAT growth +85.0% YoY, earnings stable

Why are IT Product Companies stocks underperforming despite improving earnings?

IT Product Companies deep value stocks are underperforming despite improving earnings because the market has not yet recognized their earnings recovery. This creates a potential opportunity for patient investors

  • The market often takes 2-4 quarters to re-rate stocks after earnings improve
  • Deep value stocks typically have a negative narrative that suppresses sentiment
  • Improving earnings combined with market underperformance creates a valuation gap
  • When the market eventually recognizes the recovery, re-rating can be significant
  • This is an educational explanation of deep value investing theory.

Which IT Product Companies deep value stocks have the highest revenue growth?

IT Product Companies deep value stocks with the highest revenue growth

  • Network People Services Technologies Ltd — Revenue growth +152.4% YoY
  • Zaggle Prepaid Ocean Services Ltd — Revenue growth +56.1% YoY

What is the average PE ratio of IT Product Companies deep value stocks?

The average PE ratio of IT Product Companies deep value stocks is 52.1x. Deep value stocks typically trade at lower PE multiples relative to their sector peers, reflecting the market's skepticism about their recovery.

Is the earnings recovery in IT Product Companies sustainable?

Sustainability indicators for the IT Product Companies deep value earnings recovery

  • 1 stocks showing turnaround (inflection up)
  • A sustainable recovery shows more stocks accelerating than decelerating.

What is the margin trend for IT Product Companies deep value stocks?

Operating margin trends across IT Product Companies deep value stocks

  • 1 stocks with expanding margins
  • 1 stocks with stable/volatile margins

Is IT Product Companies a contrarian opportunity worth studying?

IT Product Companies as a contrarian opportunity — key research signals

  • 2 stocks underperforming the market (contrarian setup)
  • 1 stocks showing turnaround signals
  • Contrarian investing requires patience.

What is the typical recovery timeline for deep value stocks?

Deep value stock recovery timelines vary, but historical patterns suggest

  • 1-2 quarters: Earnings inflection detected, market still skeptical
  • 2-4 quarters: Consistent earnings improvement builds confidence
  • 4-6 quarters: Market re-rates, stock price catches up to fundamentals
  • Some stocks never recover — continuous monitoring is essential
  • Timelines are approximate and based on historical patterns.

What is deep value investing?

Deep value investing is a strategy of studying stocks that are underperforming the market despite showing improving fundamentals (earnings growth, margin expansion). The thesis is that the market has not yet recognized the earnings recovery, creating a potential valuation gap.

  • These stocks typically underperform indices like Nifty 500
  • They show positive earnings trends (PAT growth, revenue growth)
  • The market eventually re-rates them as earnings improvements sustain
  • It requires patience — recovery can take several quarters

The above FAQs are based on publicly available financial data. This is educational research only. Sector Alpha is not SEBI registered and does not provide investment advice.