Valuation Metrics Reflect Improved Price Attractiveness
At the heart of Sagility’s valuation improvement lies its price-to-earnings (P/E) ratio, which currently stands at 24.61. This figure is significantly lower than many of its peers within the sector, several of which are classified as very expensive. For instance, Mindspace Business Parks trades at a P/E of 56.27, Inventurus Knowledge Solutions at 41.76, and Brookfield India at 51.26. Sagility’s P/E ratio thus positions it as a more reasonably priced option relative to these competitors.
Complementing the P/E ratio, Sagility’s price-to-book value (P/BV) is 2.42, which further supports the notion of an attractive valuation. This contrasts with the elevated multiples seen in other sector constituents, where valuations often exceed 10 times book value, signalling potential overvaluation risks elsewhere.
Enterprise value to EBITDA (EV/EBITDA) is another critical metric where Sagility demonstrates relative value. At 13.48, it is below the levels observed in many peers, such as Inventurus Knowledge Solutions at 27.76 and Cams Services at 26.55. This suggests that Sagility’s earnings before interest, taxes, depreciation and amortisation are being acquired at a more reasonable price, enhancing its appeal to value-conscious investors.
Comparative Peer Analysis Highlights Sagility’s Relative Value
When benchmarked against its industry peers, Sagility’s valuation stands out as notably attractive. The company’s EV to EBIT ratio of 18.99 is competitive, especially when compared to the likes of Mindspace Business Parks at 18.89 and Brookfield India at 18.00. While some peers such as Cube Highways exhibit extreme valuations (EV/EBITDA of 12.93 but a P/E of 945.95), Sagility maintains a balanced profile without excessive premium pricing.
Moreover, Sagility’s PEG ratio is reported as zero, which may indicate either a lack of consensus on growth estimates or a conservative growth outlook factored into the valuation. This contrasts with peers like Cube Highways (PEG 9.94) and Cams Services (PEG 39.42), where high PEG ratios suggest stretched valuations relative to growth expectations.
Financial Performance and Returns Contextualise Valuation
Beyond valuation multiples, Sagility’s return on capital employed (ROCE) and return on equity (ROE) provide insight into operational efficiency and profitability. The company’s latest ROCE is 11.09%, while ROE stands at 8.98%. These figures, while modest, indicate stable returns that support the current valuation level.
However, the stock’s recent price performance has been under pressure. Over the past week, Sagility’s share price declined by 5.6%, significantly underperforming the Sensex’s modest 0.94% drop. Over one month, the stock fell 13.96%, compared to a 0.35% gain in the benchmark index. Year-to-date, the stock is down 11.51%, while the Sensex has declined 2.28%. Even over the last year, Sagility’s return of -2.99% contrasts with the Sensex’s 9.66% gain.
These figures suggest that despite the improved valuation, market sentiment remains cautious, possibly reflecting broader sector headwinds or company-specific concerns. Nevertheless, the valuation adjustment to an attractive grade may signal a turning point for investors seeking value in the software and consulting space.
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Mojo Score Upgrade Reflects Enhanced Confidence
MarketsMOJO’s recent upgrade of Sagility’s Mojo Grade from Buy to Strong Buy on 19 Jan 2026 underscores growing confidence in the stock’s prospects. The Mojo Score of 84.0 is a robust indicator of the company’s overall quality, factoring in financial health, valuation, and momentum. This upgrade aligns with the shift in valuation grade from fair to attractive, signalling that Sagility is increasingly viewed as a compelling investment opportunity within its sector.
Despite a market capitalisation grade of 3, indicating a mid-sized company, Sagility’s valuation metrics and quality scores position it favourably against larger and more expensive peers. Investors looking for exposure to the Computers - Software & Consulting sector may find Sagility’s current price point, ₹46.03, appealing given its 52-week range of ₹37.61 to ₹57.90.
Sector and Market Context
The Computers - Software & Consulting sector has experienced significant volatility in recent months, with many stocks trading at elevated multiples. Sagility’s relative valuation attractiveness is therefore notable, especially as broader market indices such as the Sensex have outperformed the stock over the past year and year-to-date periods. This divergence may reflect sector rotation or investor preference for larger, more established names.
However, Sagility’s valuation reset could attract value investors seeking to capitalise on the company’s stable returns and improving fundamentals. The company’s enterprise value to capital employed ratio of 2.33 and EV to sales of 3.29 further support the thesis of reasonable pricing relative to asset utilisation and revenue generation.
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Investor Takeaway: Balancing Valuation and Market Risks
For investors analysing Sagility Ltd, the recent valuation shift to an attractive grade combined with a Strong Buy Mojo Grade presents a compelling case for consideration. The company’s valuation multiples are notably more reasonable than many of its sector peers, offering a potential margin of safety amid ongoing market volatility.
However, the stock’s recent underperformance relative to the Sensex and sector indices suggests caution. Investors should weigh the improved valuation against the broader market context and company-specific factors such as growth prospects and earnings stability. The absence of a dividend yield and modest returns on equity and capital employed indicate that Sagility remains a growth-oriented investment rather than a yield play.
Overall, Sagility’s repositioning in valuation terms may mark an inflection point, particularly for investors seeking exposure to the software and consulting industry at a more attractive price. Monitoring upcoming earnings releases and sector developments will be crucial to validate this positive outlook.
Summary of Key Financial Metrics
Current Price: ₹46.03 | 52-Week Range: ₹37.61 - ₹57.90 | P/E Ratio: 24.61 | P/BV: 2.42 | EV/EBITDA: 13.48 | ROCE: 11.09% | ROE: 8.98% | Mojo Score: 84.0 (Strong Buy)
Comparative Valuation Snapshot
Sagility’s valuation stands out as attractive when compared to peers such as Mindspace Business Parks (P/E 56.27), Inventurus Knowledge Solutions (P/E 41.76), and Brookfield India (P/E 51.26). This relative discount may offer investors a strategic entry point in a sector where many stocks are trading at stretched multiples.
Conclusion
Sagility Ltd’s recent valuation grade upgrade and Mojo Score improvement reflect a meaningful shift in market perception. While the stock has faced short-term price pressure, its attractive valuation metrics relative to peers and stable financial returns suggest it warrants close attention from investors seeking value in the Computers - Software & Consulting sector. The company’s balanced financial profile and reasonable multiples provide a foundation for potential upside as market conditions evolve.
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