DYNAMIC - Dynamic Services

📊 NSE: DYNAMIC 🏢 Miscellaneous 📅 Last Updated: 12/13/2025 21:42

💰 Financial Performance

Revenue Growth by Segment

Revenue grew at a CAGR of ~28% from FY23 to FY25. For FY25, Sales & Supply of Goods contributed INR 166.51 Cr (approx. 60.6% of segment revenue) and Manpower & Merchandise Cleaning Charges contributed INR 108.23 Cr (approx. 39.4% of segment revenue). Transportation revenue was Nil.

Geographic Revenue Split

The company maintains a PAN India presence with its headquarters in Kolkata, West Bengal. Specific regional percentage splits are not disclosed, but operations are conducted on a national level.

Profitability Margins

PAT margin decreased from 11.70% in FY23 to 8.81% in FY24. Return on Equity (ROE) fell from 12.68% in FY2024 to 11.40% in FY2025, a 10.09% decline, while Return on Capital Employed (ROCE) dropped from 14.54% to 10.26% (a 29.41% decrease) due to increased capital intensity.

EBITDA Margin

EBITDA margin improved significantly from 7.79% in FY23 to 15.05% in FY24, driven by healthy order book execution. However, Total Debt/EBITDA weakened from 1.60x in FY24 to 3.64x in FY25.

Capital Expenditure

The company has no major debt-funded capex plans in the medium term. Historical investments include INR 85.92 Cr in non-current financial assets as of September 2025, up from INR 65.23 Cr in March 2025.

Credit Rating & Borrowing

Assigned IVR BBB-/Stable for Long Term Bank Facilities (INR 11.55 Cr) and IVR A3 for Short Term Bank Facilities (INR 4.95 Cr) as of June 2024. Interest coverage ratio stood at 4.61x in FY25, down from 5.10x in FY24.

⚙️ Operational Drivers

Raw Materials

Labor is the primary 'raw material' for this service-oriented business, representing the bulk of operational costs. Merchandise for the 'Sales & Supply' segment constitutes the remainder of input costs.

Import Sources

Sourced domestically across India to support PAN India service delivery and supply contracts.

Capacity Expansion

Current capacity is defined by a manpower strength of 2,088 employees as of March 31, 2025. Expansion is driven by project-based hiring for new tenders.

Raw Material Costs

Labor costs are highly sensitive to statutory minimum wage increases. The company is labor-intensive, involving deployment for cleaning, catering, and security services.

Manufacturing Efficiency

Operational efficiency is tracked via the Operating Cycle, which improved from 190 days in FY23 to 111 days in FY24.

Logistics & Distribution

The company provides logistics services as part of its portfolio, leveraging the promoter's 25+ years of experience in the logistics industry.

📈 Strategic Growth

Expected Growth Rate

28%

Growth Strategy

Growth is targeted through a healthy order book of INR 1,037.19 Cr (9.82x of FY24 revenue), focusing on technologically advanced and high-margin segments, and expanding geographical reach beyond current PAN India operations.

Products & Services

Guarding/Custodial services, Integrated Facility Management, Mechanized Cleaning, Catering, Housekeeping, Conservancy, Logistics, Web Development, and IT Services.

Brand Portfolio

Dynamic Services & Security Limited (DSSL).

New Products/Services

Expansion into Web Development and IT-services to diversify from traditional manpower supply.

Market Expansion

Focusing on technologically advanced segments and aggressive productivity improvements to capture more profitable market segments.

Market Share & Ranking

Relatively small player in a highly fragmented industry dominated by large established players.

Strategic Alliances

The company operates with associates, with a share of profit from associates recorded at INR 1.26 Cr in the half-year ended September 2025.

🌍 External Factors

Industry Trends

The Indian service sector is growing robustly (IT/ITeS reached $341 billion in FY24). The security industry is evolving with a shift toward integrated facility management and technology-enabled guarding.

Competitive Landscape

Stiff competition from organized players and unorganized local firms, impacting pricing and profitability margins.

Competitive Moat

Moat is based on a 25-year track record, established relationships with government bodies like Indian Railways, and a large managed workforce of 2,088 employees. Sustainability is challenged by low entry barriers.

Macro Economic Sensitivity

Highly sensitive to Indian economic growth and government infrastructure spending, which dictates the demand for facility management and security.

Consumer Behavior

Increased demand for 'one-stop' integrated facility management solutions rather than standalone security or cleaning services.

Geopolitical Risks

Political instability or changes in economic liberalization policies could harm business conditions and government contract flows.

⚖️ Regulatory & Governance

Industry Regulations

Requires various statutory permits and licenses for security and labor deployment; non-renewal or failure to comply with rising minimum wage norms poses a risk.

Environmental Compliance

CSR obligation for FY25 was INR 25.15 Lakhs; the company spent INR 39.00 Lakhs, exceeding the requirement.

Taxation Policy Impact

Direct taxes paid (net of refunds) amounted to INR 1.17 Cr for the half-year ended September 2025.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the high collection period (134 days in FY24) due to government clients, which could lead to liquidity stress if the operating cycle elongates further.