Multibagger stock plunges 16% after weak Q1 results, revenue drop.

MPS Ltd. Shares Drop 16% After Q1 Earnings Despite Profit Rise

Shares of MPS Ltd. plummeted nearly 16% on Friday to ₹2,445.10, following the release of its Q1 FY26 earnings, raising concerns among investors despite a significant rise in profit. The company’s market capitalisation dropped to ₹4,182 crore as selling pressure mounted.

Q1 Performance Highlights:

Revenue rose marginally by 2.9% YoY to ₹186.3 crore.

Net Profit surged 40% to ₹35 crore, primarily due to higher other income.

EBITDA grew by 21% to ₹50 crore, with margins improving from 22.8% to 27% YoY.

Research Solutions division, which contributes 59% of total revenue, reported a decline in revenue from ₹118 crore to ₹108 crore—a key concern for analysts and shareholders.

Stock Movement:

Despite recent decline, the stock has shown multibagger returns:

228% gain in 3 years

747% gain in 5 years

Still up 16% year-to-date, even after Friday’s sell-off.

Strategic Moves:

MPS is undergoing corporate restructuring:

Amalgamation of ADI BPO Services Ltd. with MPS to streamline operations and improve resource allocation.

Restructuring of MPS Europa AG by transferring its stake in MPS Interactive Systems Ltd., making it a step-down subsidiary.

These strategic changes reflect the company’s intention to simplify its structure and align operations with long-term goals, especially after mixed performance in its core businesses.

Investor Sentiment:

Investors reacted negatively to the Q1 results due to concerns around stagnant revenue growth and underperformance in key verticals, even though profitability metrics improved.

The management’s focus on restructuring and improving operational efficiency will be closely watched in the coming quarters. Analysts believe that while the company has demonstrated strong historical returns, sustaining future growth will depend on how effectively it turns around its Research Solutions division and leverages its improved margins.