SIGMA - Sigma Solve

📊 NSE: SIGMA 🏢 Computers - Software - Medium / Small 📅 Last Updated: 12/14/2025 13:22

💰 Financial Performance

Revenue Growth by Segment

IT software services contribute more than 95% of revenue, while products contribute less than 5%. Recurring revenues represent 65% of the portfolio, with one-time services at 35%. Consolidated revenue for FY25 grew 13.09% YoY to INR 77.57 Cr, and H1 FY26 revenue surged 45.26% YoY to INR 49.95 Cr.

Geographic Revenue Split

100% of revenue is derived from exports, primarily to the USA via the subsidiary Sigma Solve Inc. (Florida), with additional home offices in Atlanta and Australia.

Profitability Margins

Consolidated Net Profit Margin was 24.61% in FY25 (down from 28.17% in FY24) and stood at 23.70% in H1 FY26. Standalone Net Profit Margin for Q2 FY26 improved to 17.66% from 13.70% YoY.

EBITDA Margin

Consolidated EBITDA margin was 34.46% in FY25 (INR 26.73 Cr), a decrease from 38.34% in FY24. H1 FY26 consolidated EBITDA margin stood at 32.66% (INR 16.31 Cr), reflecting a slight YoY compression of 36 bps.

Capital Expenditure

Historical investment includes the acquisition of the remaining 40.19% stake in Sigma Solve Inc. at a valuation of USD 5.07 million (approx. INR 42 Cr) in October 2023. Planned expansion includes a new technology hub in Pune to enhance talent capabilities.

⚙️ Operational Drivers

Raw Materials

Human capital/Software professionals represent the primary 'raw material,' with employee benefit expenses accounting for approximately 36% of total revenue.

Import Sources

Operations are primarily based in Ahmedabad (Gujarat) and Pune (Maharashtra), India, with sales and onshore support based in Florida and Atlanta, USA, and Australia.

Key Suppliers

Not disclosed in available documents as the company is a service provider.

Capacity Expansion

Current employee base is 224 professionals as of FY25, a net addition of 28 employees (14% growth). Expansion is focused on the new Pune center to tap into a key technology hub.

Raw Material Costs

Employee costs are the dominant expense at 36% of revenue. The company utilizes a hybrid model (onshore/offshore) to manage these costs while maintaining a 90%+ client retention rate.

Manufacturing Efficiency

Efficiency is driven by revenue charge-out rates on a per-man-hour basis. The company aims to achieve higher charge-out rates through specialized domain expertise in sectors like Logistics and CRM.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

Growth will be achieved through the 100% ownership of Sigma Solve Inc., capturing full sales margins. The company is scaling its US sales team for lead generation, expanding delivery capacity in Pune, and integrating AI-led solutions which are expected to contribute 5% to the revenue topline. Strategic partnerships in Logistics and CRM are also projected to add 5% to growth.

Products & Services

Custom enterprise applications, AI-based digital transformation services, eCommerce platforms, web and mobile applications, and specialized software for Logistics and CRM sectors.

Brand Portfolio

Sigma Solve

New Products/Services

AI-based solutions and customized products in the logistics and CRM sectors, each expected to contribute approximately 5% to the revenue topline.

Market Expansion

Expansion into the Pune technology hub and stabilization of the US-based sales and marketing teams to drive outbound lead generation.

Strategic Alliances

Significant partnerships established in the Logistics and CRM space to drive a 5% increase in revenue topline.

🌍 External Factors

Industry Trends

The industry is shifting toward AI-led digital transformation. Sigma is positioning itself to capture this by pivoting from general IT services to high-value AI and custom enterprise applications, targeting a USD 30 million revenue goal within 4 years.

Competitive Landscape

Operates in a fragmented global IT services market, competing on the basis of domain expertise in Logistics, CRM, and Fintech.

Competitive Moat

Durable advantages include a 90%+ client retention rate and a 100% owned US-based sales arm (Sigma Solve Inc.) which facilitates low customer acquisition costs and high-touch client management.

Macro Economic Sensitivity

Highly sensitive to US economic conditions and enterprise IT budgets, as 100% of revenue is derived from international clients.

Consumer Behavior

Enterprises are increasingly demanding AI-integrated solutions to maximize revenue, prompting Sigma to invest in AI-based product development.

Geopolitical Risks

Exposed to global trade tensions and potential changes in international tax structures which could impact the cross-border service model.

⚖️ Regulatory & Governance

Industry Regulations

Subject to US immigration laws for onsite personnel (H1B/L1A visas) and international data privacy standards. The company recently secured 2 H1B and 1 L1A visa approvals.

Taxation Policy Impact

Not disclosed in available documents; however, the company notes that changes in tax structures could impact operations.

⚠️ Risk Analysis

Key Uncertainties

Primary risks include the stabilization of the US sales team and the successful commercialization of AI-based solutions, which are critical to meeting the 20% growth target.