Newgen Software Technologies Ltd: Is It a Deep Value Opportunity?

Newgen Software Technologies Ltd has a deep value score of 29/100 (rated Weak). This score is calculated from three components

• Earnings Score: 3/40 — measures PAT growth momentum across quarters
• Underperformance Score: 26/35 — how much the stock trails Nifty 500 (deeper underperformance = higher contrarian signal)
• Quality Score: 0/25 — operational quality (margins, revenue growth, valuation)

Newgen Software Technologies Ltd's quarterly profit (PAT) growth trajectory

• Latest Quarter PAT Growth (QoQ): -41%
• Previous Quarter PAT Growth (QoQ): +69%
• 2 Quarters Ago PAT Growth (QoQ): -23%
• PAT Acceleration: -8.9pp (profits are decelerating)

Newgen Software Technologies Ltd is underperforming the market despite improving earnings — this is the core deep value thesis

• 1-Year Return vs Nifty 500: -46%
• 6-Month Return vs Nifty 500: -26%
• 3-Month Return vs Nifty 500: +11%
• Yet average quarterly PAT growth is +2% — earnings are improving
• The market often takes time to re-rate stocks with improving fundamentals. This gap between price performance and earnings improvement is what deep value research seeks to identify.

Newgen Software Technologies Ltd's earnings momentum is Decelerating — growth rate is slowing.

• PAT QoQ progression: -23% → +69% → -41% (2Q ago → 1Q ago → latest)
• Acceleration: -8.9pp

Newgen Software Technologies Ltd's valuation metrics

• Price-to-Earnings (PE): 24.6x
• Price-to-Book (PB): 4.4x
• PEG Ratio: 1.8x

Newgen Software Technologies Ltd's revenue and margin trends

• Latest Quarter Revenue Growth (QoQ): -21%
• Average Quarterly Revenue Growth: -3%
• Revenue Acceleration: -10.5pp
• Latest OPM Change: -17.9pp (margins contracting)
• Average OPM Change: -3.3pp

Newgen Software Technologies Ltd key facts

• Sector: IT Product Companies
• Market Cap: ₹7.8K Cr
• Rank in IT Product Companies: #2 by value score
• Overall rank among all deep value stocks: #126

Newgen Software Technologies Ltd shows limited deep value signals currently — score is 29/100 (Weak). Monitor for improvement.

• Value Score: 29/100 (Weak)
• Earnings: Not accelerating
• 1Y Underperformance: -46% vs Nifty 500

Other deep value stocks in IT Product Companies

• Zaggle Prepaid Ocean Services Ltd — Score 50/100, Average

IT Product Companies deep value sector overview

• 2 deep value stocks in this sector
• Average value score: 40/100
• Avg PAT acceleration: -10.5pp
• Top pick: Zaggle Prepaid Ocean Services Ltd

Deep value investing studies stocks that are underperforming the market despite showing improving fundamentals. The thesis is that the market has not yet recognized the earnings recovery, creating a potential valuation gap. It requires patience — recovery can take several quarters.

The deep value score (0-100) combines three factors:

- Earnings (0-40 pts): PAT growth across last 3 quarters, acceleration, and consecutive growth - Underperformance (0-35 pts): How much the stock trails Nifty 500 over 1Y, 6M, 3M (deeper underperformance = higher score) - Quality (0-25 pts): Revenue growth, margin trends, and valuation metrics (PEG, P/B)

Higher score indicates a stronger contrarian research signal.