Kapston Services 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.

Kapston Services Ltd trades at ₹588, in a confirmed uptrend and 67 weeks into that stage. That is +61.1% against its own 200-day average. It sits at 100% of a 52-week range of ₹192 to ₹588. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 53 straight weeks.

Today the stock is in a confirmed uptrend — week 67 of stage 2, confirmed. At ₹588 it trades +61.1% versus its 200-day average and sits at 100% of its 52-week range (₹192–₹588).

Against the market, two honest reads. Cumulative: over the last 8.4 years the stock moved +2,148% while the NIFTY 500 moved +148% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 53 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.

Story check

Kapston Services Ltd's story is not scored yet against the markers our research file set on 17 May 2026. Where it sits in its own cycle: INFLECTION_UP. Still open: Base effects normalizing — 64% PAT growth in Q3 FY26 vs 119% a year earlier. Without B2C uplift, organic trajectory implies 20-30% PAT growth in FY27 at current margin structure.

Our read, 17 May 2026. A profitable small-cap manpower compounder hitting operating leverage inflection — the B2C home services bet is the option, not the base.

From the numbers. PE 37.4x at 57th percentile of available cycle range (data sufficiency LIMITED per pe_pb_cycle table). PE/PB both at upper end of comparable range [25-40x / 7-12x]. No FII buying — zero FII holding across all reported…

From the price. Price stage 2, week 67 — above its 200-day line, relative strength rising.

From the research. A profitable small-cap manpower compounder hitting operating leverage inflection — the B2C home services bet is the option, not the base.

🚨 Where they disagree. PE 37.4x at 57th percentile of available cycle range (data sufficiency LIMITED per pe_pb_cycle table). PE/PB both at upper end of comparable range [25-40x / 7-12x]. No FII buying — zero FII holding across all reported quarters. YoY PE trend INFLECTION_UP with qoq momentum EXPANSION. At Bronze conviction, the cycle position does not provide a margin of safety — entry depends on thesis execution, not valuation gap.

What is proven. A profitable small-cap manpower compounder hitting operating leverage inflection — the B2C home services bet is the option, not the base.

What is not proven yet. Base effects normalizing — 64% PAT growth in Q3 FY26 vs 119% a year earlier. Without B2C uplift, organic trajectory implies 20-30% PAT growth in FY27 at current margin structure.

🚨 Layer 1 read, 19 July 2026 — DROP. Real 8-quarter P&L growth, but the profits aren't converting to cash and the stock has already run 11x. Revenue rose for 8 straight quarters (141 -> 213 Cr) with EPS tripling and OPM inflecting toward 5.3%, a genuine operating-leverage story. But over 3 years the business generated only Rs 5 Cr of operating cash against Rs 59 Cr of reported PAT (accrual-heavy) on 1.61x debt/equity, and the price has already run +156% in a year to its all-time high (extended, innings 7). With a web-fallback (synthetic) timeline and no management guidance to check, the cash-conversion gap is unresolved.

What would change Layer 1’s mind. If FY26 OCF/PAT recovers toward >=0.8 (proving the reported profits are real cash) AND Kapston Home Services posts its first material metro-market revenue, the accrual flag clears and it re-rates toward P1; a Q4 PAT-YoY collapse below 20% or OPM falling under 5% confirms the deceleration and breaks the operating-leverage thesis.

The test written in advance. PAT growth deceleration (119% → 85% → 80% → 64% trend) — PAT growth deceleration (119% → 85% → 80% → 64% trend) Q4 FY26 PAT YoY — if below 50%, deceleration is confirmed as the new trajectory by the next result.

The test written in advance. Elevated debt burden (D/E 1.61x, debt-to-EBITDA 5.32x) — Elevated debt burden (D/E 1.61x, debt-to-EBITDA 5.32x) D/E trend in FY26 annual results — stabilization or reduction required for re-rating by the next result.

The test written in advance. B2C competitive intensity (Urban Company, unorganized sector) — B2C competitive intensity (Urban Company, unorganized sector) B2C revenue contribution in Q4 FY26 and Q1 FY27 disclosures; platform review scores by the next result.

Lever 1 · Operating leverage — BUILDING. Employee costs >90% of revenue become a leverage engine at scale — each incremental contract drops at 15-20% EBITDA conversion as fixed overheads are absorbed. What proves it keeps working: Operating Leverage Inflection (Scale > 30,000 headcount). It stops working if Q4 FY26 PAT YoY — if below 50%, deceleration is confirmed as the new trajectory.

Lever 5 · Regulatory approval — BUILDING. 700+ client base across 12 sectors creates cross-sell vectors (general staffing → security → facility management → IT staffing) with lower CAC per incremental service. What proves it keeps working: Client Wallet Share Expansion (700+ clients, cross-sell). It stops working if Q4 FY26 PAT YoY — if below 50%, deceleration is confirmed as the new trajectory.

Lever 10 · New geographies — BUILDING. 15 branch offices across India (Delhi, Gurugram, Mumbai, Chennai, Bengaluru, Kolkata, Pune, Bhubaneswar, Raipur, Vizag, Guntur, Guwahati, Indore, Jharkhand) — incremental revenue at lower marginal cost. What proves it keeps working: Geographic Expansion (PAN India from Hyderabad base). It stops working if Q4 FY26 PAT YoY — if below 50%, deceleration is confirmed as the new trajectory.

Lever 11 · Selling more to existing customers — BUILDING. 100% subsidiary incorporated Feb 2026, soft beta launched Hyderabad Apr 19 2026. Services: cleaning, beauty/spa, EPC, AC repair, painting. Higher margin than B2B staffing if unit economics hold. What proves it keeps working: B2C Home Services Entry — Option Value (Kapston Home Services Pvt Ltd). It stops working if Q4 FY26 PAT YoY — if below 50%, deceleration is confirmed as the new trajectory.

Sources: our stock research file (17 May 2026) · quarterly results through Jun 26. The story check is re-scored every results season; the record below never changes.

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

Kapston Services Ltd reported ₹222 Cr of revenue in the Jun 26 quarter, +16.2% year on year. That is the 11th straight quarter of year-on-year growth. Over 10 years it has compounded at 27.2% a year. The last full year, FY26, came in at ₹830 Cr. The last four reported quarters add to ₹861 Cr.

Why this happened. Kapston scaled from Hyderabad-centric (pre-2021) to PAN India services (from 2021) with 15 listed branch offices. Geographic expansion drives volume without proportional fixed cost addition — the regional offices share central HR, compliance, and tech infrastructure. Demonstrated in the annual report as a stated growth lever.

FY26 revenue came in at ₹830 Cr (+20.5% on the year), capping 10 years at 27.2% compound. The latest quarter (Jun 26) printed ₹222 Cr, +16.2% year on year — the 11th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +18.7% growth against the decade's 27.2% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +18.5% over the last 4 quarters against +24.0%/yr over the last 8 — rolling over; TTM profit +47.8% vs +52.6%/yr — rolling over.

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.

Kapston Services Ltd's operating margin is 6.6% in the Jun 26 quarter, +1.8 percentage points against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 3.0% to 9.0%. The current quarter sits inside that band.

Why this happened. Employee costs >90% of revenue become a leverage engine at scale — each incremental contract drops at 15-20% EBITDA conversion as fixed overheads are absorbed.

The latest quarter's operating margin is 6.6%, +1.8 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 3.0%–9.0%.

Why the margin moved: operating margin went +1.8 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.

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

Kapston Services Ltd earned ₹8.5 Cr of net profit in the Jun 26 quarter, +38.5% year on year. It is the 7th consecutive quarter of growth. Full-year FY26 profit was ₹28.0 Cr. The 10-year compound rate is 30.2%. That is 3.8% of the quarter's revenue. The same quarter a year earlier earned ₹6.1 Cr.

Jun 26 profit was ₹8.5 Cr, +38.5% year on year — the 7th consecutive quarter of growth. On the full year, FY26 printed ₹28.0 Cr (+55.6%), and the 10-year compound rate is 30.2%.

Why profit moved: revenue contributed +16.2% and the margin +1.8 pp — the quarter was revenue-led, with the margin roughly flat.

Pace comparison, last four quarters: profit +51.6% vs revenue +18.7%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

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 8% of Kapston Services Ltd's reported profit arrived as operating cash — a gap worth watching. In FY26 that was ₹9.0 Cr of operating cash against ₹28.0 Cr of profit. After ₹8.0 Cr of capital spending, ₹1.0 Cr was left as free cash.

FY26: operating cash of ₹9.0 Cr against reported profit of ₹28.0 Cr, leaving free cash of ₹1.0 Cr after ₹8.0 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 8% 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 8%: the cash cycle tightened 20 days between FY21 and FY26 — cash that used to wait in the cycle now reaches the bank sooner. Less than 70% of profit arriving as cash is the thing to watch on this page.

Router verdict: the bigger cash user is investment — capital spending ran 4.8× depreciation over three years, so the next section's job is to check what that build-out is buying.

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).

Kapston Services Ltd's cash conversion cycle runs 89 days in FY26, down from 109 days in FY21. Capital spending ran ₹58.0 Cr over the last 3 years. At FY26 sales of ₹830 Cr each day of that cycle holds about ₹2.3 Cr, so roughly ₹202 Cr sits inside the business at any moment.

FY26: debtors at 89 days (an asset-light business — no inventory to speak of) — for a full cycle of 89 days, tighter than FY21's 109.

In money terms: at FY26 sales of ₹830 Cr, each day of the cycle holds about ₹2.3 Cr — so the 89-day loop keeps roughly ₹202 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹58.0 Cr over the last 3 fiscal years against ₹12.0 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹0.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

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.⚠ unverified

Kapston Services Ltd earns a ROCE of 15% in FY26. That is up from a trough of 6% in FY22. Return on invested capital clears the cost of that capital by +3.2 percentage points, so growth here adds value rather than only size. The wiring behind it is 3.4% net margin on 2.38× asset turns.

FY26 ROCE is 15%, recovered from a FY22 trough of 6% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 3.4% net margin × 2.38× asset turns × 3.01× balance-sheet leverage ≈ 24.4% on equity. Margin does its share; leverage is a meaningful part of the equation.

The capstone test — ROIC − WACC: 15.2% − 12.0% = a +3.2 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. Positive but thin — value creation with little room for error.

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.⚠ unverified

Kapston Services Ltd carries total debt of ₹184 Cr against shareholder equity of ₹116 Cr as of Mar 26, a debt-to-equity of 1.59. On the annual view that ratio went from 1.57 in FY22 to 1.59 in FY26. Read the returns elsewhere on this page with that leverage in mind.

Mar 26: total debt of ₹184 Cr against shareholder equity of ₹116 Cr — a debt-to-equity of 1.59. On the annual view, debt-to-equity went from 1.57 (FY22) to 1.59 (FY26). Read the returns on this page with that leverage in mind.

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.

No holder of Kapston Services Ltd moved a full percentage point over the last two years — the register is quiet. Foreign institutions moved +0.0 points over the same window, to 0.0%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Promoters: +0.0 points over 8 quarters to 72.9%; Foreign institutions: +0.0 points over 8 quarters to 0.0%.

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.

Kapston Services 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.

Why this happened. The Q2 FY26 investor presentation explicitly states 'We have enhanced our footprint across new Industries and existing clients following our vision to be one of leading manpower services company in India.' Cross-sell of multiple service lines to existing clients is lower-risk revenue versus new client acquisition. The diversified sector exposure (Manufacturing, Pharma, IT/ITES, Healthcare, Govt/PSUs, FMCG, E-commerce) reduces single-sector concentration risk.

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

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.

Kapston Services Ltd trades at 58.7× P/E, about the priciest it has ever traded. Its long-run median P/E is 34.5×, measured across 1.8 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 58.7× is about the priciest it has ever traded, against a long-run median of 34.5× measured over 1.8 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 +57.4% against a +263.0% price move — the price outran earnings, pushing the multiple UP its own range.

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

A quarterly PEG curve, which only the second data source carries, is not drawn on this page: its two data sources do not share enough overlapping reported history to be compared. A figure nobody could check is not used to price growth — the gap is a decision, not missing data.

What the price assumes This reading works the multiple backwards. It asks one question: what yearly rate of profit growth is a buyer at the market price already paying for? The number is the growth rate that makes eleven years of profit — six years growing, then five fading — add up to that day's market price, once each year is discounted at 11% a year.

Solved at its 20 July 2026 price, Kapston Services Ltd was paying for profit growth of about 26.4% a year. Profit itself has compounded 30.2% a year over the past 10 years. Today the market pays 58.7× P/E, the 100th percentile of its own 2-year range.

What the two numbers say together. The multiple is full against its own past, and the growth the price is paying for is close to what this company has actually delivered.

How to hold this number: it is a reading of one day's price, taken on 20 July 2026, not a running figure — every other number on this page, the multiple included, is read off the live quote as of 11 September 2026. A higher price is paying for more growth and a lower price for less, so it moves whenever the price does, and this page does not restate it between measurements.

Stage: Mixed 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).

Kapston Services Ltd reads as mixed on its fundamental arc. Mixed — growth is normalizing off a hyper-growth base: profit growth has eased from +83.4% at its peak to +47.8% but is still expanding, ROCE lifting at 15.0%. The read is built from 8 quarters across 4 curves, on partial evidence.

Why it matters: when the curves disagree, the per-curve reads above matter more than any single verdict.

Return readings here are annual, not quarterly — read as level and direction only; they can confirm the growth curves but never drive the stage on their own.

A partial read: at least one curve is short, or the returns curve is not the computed quarterly series — hold the stage word a little more loosely.

4-Factor Sector Score

65.7/100 — rank 1 of 8 in Services - Others · 80% evidence confidence

Kapston Services Ltd scores 65.7 out of 100 against the 8 companies it is compared with in Services - Others, ranking 1. Balanced evidence: keep at normal research priority and require another comparable period before raising conviction.

The four contributions add to the total exactly: 28.7 + 8.5 + 8.5 + 20 = 65.7. 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.

Frequently asked questions