Newgen Software Technologies Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Newgen Software Technologies Ltd trades at ₹548, in a downtrend and 50 weeks into that stage. That is −12.2% against its own 200-day average. It sits at 23% of a 52-week range of ₹422 to ₹976. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 2 straight weeks.

Today the stock is in a downtrend — week 50 of stage 4, confirmed. At ₹548 it trades −12.2% versus its 200-day average and sits at 23% of its 52-week range (₹422–₹976).

Against the market, two honest reads. Cumulative: over the last 8.5 years the stock moved +368% while the NIFTY 500 moved +153% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 2 straight weeks — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

→ The trend is one thing; the bill is another. Are you paying up for it? Next: the P/E sits at the 43rd percentile of its own range.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Newgen Software Technologies Ltd trades at 21.0× P/E, mid-range by its own standards (43rd percentile). Its long-run median P/E is 22.9×, measured across 8.5 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 21.0× is mid-range by its own standards (43rd percentile), against a long-run median of 22.9× measured over 8.5 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved −5.1% against a −43.1% price move — earnings outran the price, pushing the multiple DOWN its own range.

The price move, decomposed: over 5y, of the +9.5%/yr price move, ~+19.4%/yr came from earnings growth and ~−9.9 pp from the multiple (compressing). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is unremarkable against its own past, so the story rests on the earnings line underneath it, not the multiple.

→ Cheap or dear rides on the earnings. Are they actually growing? Next: the fundamental stage — where the business sits in its arc, and how growth has compounded.

Stage: Deteriorating Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Newgen Software Technologies Ltd reads as deteriorating on its fundamental arc. Deteriorating — profit and EPS growth are shrinking (profit growth −0.9% latest against +47.7% at its 12-quarter best), ROCE slipping at 23.4%. The read is built from 12 quarters across 4 curves, on full evidence.

🚨 Why it matters: falling curves mean every cheap-looking ratio below needs a discount for direction.

→ The stage names the trajectory. Next: the revenue line that produces it, quarter by quarter.

4-Factor Sector Score

52.1/100 — rank 5 of 9 in IT Product Companies · 94% evidence confidence

Newgen Software Technologies Ltd scores 52.1 out of 100 against the 9 companies it is compared with in IT Product Companies, ranking 5. Cheap but unconfirmed: require improving earnings before treating the valuation as an opportunity.

The four contributions add to the total exactly: 15.7 + 17.1 + 15.2 + 4.1 = 52.1. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Newgen Software Technologies Ltd reported ₹357 Cr of revenue in the Jun 26 quarter, +11.2% year on year. That is the 12th straight quarter of year-on-year growth. Over 10 years it has compounded at 16.3% a year. The last full year, FY26, came in at ₹1,574 Cr. The last four reported quarters add to ₹1,611 Cr.

Newgen Software Technologies Ltd reported ₹357 Cr of revenue in the Jun 26 quarter, +11.2% year on year. That is the 12th straight quarter of year-on-year growth. Over 10 years it has compounded at 16.3% a year. The last full year, FY26, came in at ₹1,574 Cr. The last four reported quarters add to ₹1,611 Cr.

FY26 revenue came in at ₹1,574 Cr (+5.9% on the year), capping 10 years at 16.3% compound. The latest quarter (Jun 26) printed ₹357 Cr, +11.2% year on year — the 12th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +8.2% growth against the decade's 16.3% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +7.9% over the last 4 quarters against +11.0%/yr over the last 8 — rolling over; TTM profit −0.9% vs +8.0%/yr — rolling over.

→ Revenue grew — did margins hold as it scaled? Next: 16.0% this quarter (+2.0 pp YoY).

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Newgen Software Technologies Ltd's operating margin is 16.0% in the Jun 26 quarter, +2.0 percentage points against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 11.0% to 29.0%. The current quarter sits inside that band.

Newgen Software Technologies Ltd's operating margin is 16.0% in the Jun 26 quarter, +2.0 percentage points against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 11.0% to 29.0%. The current quarter sits inside that band.

The latest quarter's operating margin is 16.0%, +2.0 pp against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 11.0%–29.0%.

Why the margin moved: operating margin went +1.7 pp year on year while gross margin went +0.0 pp — the gain came mostly below the gross line: operating leverage, with costs spread over a bigger revenue base.

→ Margins held — did that reach the bottom line? Next: profit +26.0% in the latest quarter.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Newgen Software Technologies Ltd earned ₹63.0 Cr of net profit in the Jun 26 quarter, +26.0% year on year. Full-year FY26 profit was ₹301 Cr. The 10-year compound rate is 26.8%. That is 17.6% of the quarter's revenue. The same quarter a year earlier earned ₹50.0 Cr.

Newgen Software Technologies Ltd earned ₹63.0 Cr of net profit in the Jun 26 quarter, +26.0% year on year. Full-year FY26 profit was ₹301 Cr. The 10-year compound rate is 26.8%. That is 17.6% of the quarter's revenue. The same quarter a year earlier earned ₹50.0 Cr.

Jun 26 profit was ₹63.0 Cr, +26.0% year on year. On the full year, FY26 printed ₹301 Cr (−4.4%), and the 10-year compound rate is 26.8%.

Why profit moved: revenue contributed +11.2% and the margin +2.0 pp — the quarter was margin-led: most of the profit growth came from keeping more of each sale.

Pace comparison, last four quarters: profit +3.0% vs revenue +8.2%. Profit is growing slower than sales — costs are eating the growth before it reaches the bottom line.

→ Profit rose — but did the cash follow? Next: 84% of the last 3 years' profit arrived as cash.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 84% of Newgen Software Technologies Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY26 that was ₹232 Cr of operating cash against ₹301 Cr of profit. After ₹18.0 Cr of capital spending, ₹214 Cr was left as free cash.

FY26: operating cash of ₹232 Cr against reported profit of ₹301 Cr, leaving free cash of ₹214 Cr after ₹18.0 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 84% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 84%: the cash cycle stretched 35 days between FY21 and FY26 — more of each rupee of profit waits inside the cycle before arriving.

Router verdict: no single sink dominates — the next section checks both the working-capital cycle and the capital spending.

→ So follow the cash to where it goes. Next: a 164-day cycle and ₹93.0 Cr of building.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Newgen Software Technologies Ltd's cash conversion cycle runs 164 days in FY26, up from 129 days in FY21. Capital spending ran ₹93.0 Cr over the last 3 years. At FY26 sales of ₹1,574 Cr each day of that cycle holds about ₹4.3 Cr, so roughly ₹707 Cr sits inside the business at any moment.

FY26: debtors at 164 days (an asset-light business — no inventory to speak of) — for a full cycle of 164 days, looser than FY21's 129.

In money terms: at FY26 sales of ₹1,574 Cr, each day of the cycle holds about ₹4.3 Cr — so the 164-day loop keeps roughly ₹707 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹93.0 Cr over the last 3 fiscal years against ₹98.0 Cr of depreciation — spending at or below maintenance level. Capital work-in-progress stands at ₹1.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: neither the cycle nor the build-out is hoarding the cash — the machine is reasonably clean.

→ Does all this activity actually earn its cost of capital? Next: ROCE is 25% and the ROIC − WACC spread is +30.9 pp.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Newgen Software Technologies Ltd earns a ROCE of 25% in FY26. That is up from a trough of 14% in FY16. Return on invested capital clears the cost of that capital by +30.9 percentage points, so growth here adds value rather than only size. The wiring behind it is 19.1% net margin on 0.64× asset turns.

FY26 ROCE is 25%, recovered from a FY16 trough of 14% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 19.1% net margin × 0.64× asset turns × 1.37× balance-sheet leverage ≈ 16.7% on equity. Margin is doing the heavy lifting; leverage is modest — this is an earned return, not a borrowed one.

The capstone test — ROIC − WACC: 42.9% − 12.0% = a +30.9 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. A spread this wide means every rupee reinvested creates more than a rupee of value — the engine compounds.

→ Returns like these — is the balance sheet borrowing to make them? Next: debt-to-equity is 0.02.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

Newgen Software Technologies Ltd carries total debt of ₹39.0 Cr against shareholder equity of ₹1,777 Cr as of Jun 26, a debt-to-equity of 0.02 — effectively unlevered. On the annual view that ratio went from 0.03 in FY22 to 0.02 in FY26. The returns elsewhere on this page are therefore earned rather than borrowed.

Jun 26: total debt of ₹39.0 Cr against shareholder equity of ₹1,777 Cr — a debt-to-equity of 0.02. On the annual view, debt-to-equity went from 0.03 (FY22) to 0.02 (FY26). The returns on this page are earned, not borrowed.

→ Who owns this, and are they adding or leaving? Next: Foreign institutions cut 4.1 points over 8 quarters.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Foreign institutions cut 4.1 points of Newgen Software Technologies Ltd over 8 quarters, the biggest move on the register. That takes foreign institutions to 13.8% of the company. Domestic institutions moved −1.8 points over the same window, to 8.2%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Foreign institutions: −4.1 points over 8 quarters to 13.8%; Domestic institutions: −1.8 points over 8 quarters to 8.2%; Promoters: −0.8 points over 8 quarters to 53.5%.

🚨 Why the register moved: foreign institutions drove it (−4.1 points), alongside domestic institutions (−1.8 points) — distribution into the market’s bid.

→ One last check: does the safety math agree? Next: the balance-sheet safety line.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Newgen Software Technologies Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

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