The shares of the Small-Cap company, specializing in creating and implementing large-scale e-governance solutions and digital public infrastructure, are in focus after leading Indian Brokerage firm Anand Rathi initiated a Buy Target with an upside potential of 45 percent.
With a market capitalization of Rs. 3,474.07 Crores on Tuesday, the shares of Protean eGov Technologies Ltd rose upto 0.5 percent, reaching a high of Rs. 852.50 compared to its previous closing price of Rs. 848.35. Ace investor Mukul Mahavir Agrawal bought a stake in the company during the September 2025 quarter and now holds up to 1.48 percent of the company.
What Happened
Protean eGov Technologies Ltd, engaged in creating and implementing large-scale e-governance solutions and digital public infrastructure, is in focus after a leading Brokerage firm, Anand Rathi, reiterated its ‘Buy’ rating with a price target of ₹1,235 on it with an upto 45 percent Upside Potential from yesterday’s close price.
The reasons for the “Buy” target
Steady Growth Outlook with New Business Momentum: Protean eGov Technologies reported strong revenue growth of 14% YoY in Q2 FY26, supported by a robust pipeline of turnkey projects worth more than ₹16 billion. With steady pension revenue and rising contributions from new and international businesses, Anand Rathi expects a 14–16% CAGR in revenue/PAT over FY25–28.
Diversifying Revenue Mix: The company is steadily diversifying away from dependence on PAN services, which saw a decline in contribution from 54% in Q2 FY25 to 43% in Q2 FY26. Growth in pension, international, and new digital service verticals indicates a broad-based revenue model, reducing concentration risk and improving long-term stability. Ahead, Management expects new business to contribute ~25% to revenue in the next 2 years.
International Expansion Driving Growth: International business revenue grew by 5x YoY, primarily driven by RFP wins from CRISAL and Brim Systems. Additionally, the company has also secured the mandate from UIDAI to establish and operate district-level Aadhar Seva Kendras (ASKs) worth ₹13.7bn, which will translate into the yearly revenue of ~₹ 2bn, indicating growing traction in global and government-led digital initiatives.
Attractive Valuation and Growth Potential: Anand Rathi expects 16% CAGR in earnings over FY25–28 with improving margins and stronger operating leverage. The revised target price of ₹1,235 (37x FY27E P/E) reflects confidence in sustained growth, improved mix of high-margin businesses, and expanding international presence.
Financials & Others
The company’s revenue rose by 14.02 percent from Rs. 220 crores to Rs. 250 crores in Q2FY25-26. Meanwhile, Net profit declined from Rs. 28 crores to Rs. 24 crores in the same period.
The company maintains a strong financial position with a ROCE of 11.7% and ROE of 9.38%, reflecting decent profitability. With a debt-to-equity ratio of just 0.07, it is almost debt-free, indicating strong financial stability.
It has also been consistent in rewarding shareholders, maintaining a healthy dividend payout of 41.1%. Additionally, debtor days have improved significantly from 81.3 to 62.6 days, showcasing better working capital management and improved cash flow efficiency.
Protean eGov Technologies Ltd, formerly known as NSDL e-Governance Infrastructure Ltd, was founded in 1995 and is headquartered in Mumbai. It is an Indian IT services company that specializes in developing digital public infrastructure and e-governance solutions for the government and citizens.
The company’s Key projects include modernizing India’s tax infrastructure (PAN), managing the National Pension System (NPS), and contributing to digital identity initiatives such as Aadhaar.
Protean is building a strong pipeline of turnkey businesses, with more than Rs. 1,600 crore order book as on 30th September 2025, and is also strategically expanding a high-quality pipeline of RFP-led business opportunities.
Written by Sridhar J
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