How we score

Every Reality Check score is derived from a single source: the company's most recent audited filing with the Ministry of Corporate Affairs. No press releases. No management commentary. No projections.

Three dimensions

Each company gets three independent scores, each on a 1–10 scale. The average of the three appears on the homepage card. The breakdown is always visible in the full article.

Growth Quality

Is the revenue growth real and operating in nature?

Sustainability

Can the business sustain itself without emergency capital?

Profitability Path

Is there a filing-evidenced trajectory to profit?

Dimension 01

Growth Quality

Measures whether revenue growth is real, recurring, and driven by the operating business — not by one-time asset sales, accounting reclassifications, or intra-group transactions.

What raises or lowers this score

–Revenue growth rate year-on-year from the audited P&L
–Proportion of revenue from continuing vs discontinued operations
–Contribution of non-recurring items (asset disposal gains, one-time settlements)
–Whether the growth driver is visible in the notes (by product, segment, or geography)
–Unit economics trend: revenue growing faster or slower than variable costs

Score anchors

9–10

Exceptional

Strong growth (30%+), entirely from continuing operations, improving unit economics

7–8

Good

Solid growth (15–30%), predominantly operating, minor non-recurring contribution

5–6

Moderate

Growth present (5–15%) or good headline growth with meaningful non-recurring component

3–4

Weak

Low growth (0–5%) or growth heavily reliant on one-time items

1–2

Poor

Revenue decline, or growth that is entirely non-recurring

Dimension 02

Sustainability

Measures whether the business can sustain its current operations financially — factoring in burn rate, cash position, debt structure, and operating leverage. A company can score well here without being profitable if its runway is long and leverage is manageable.

What raises or lowers this score

–Operating cash flow (positive or negative, improving or worsening)
–Cash and liquid investments relative to monthly burn
–Debt-to-equity ratio and whether leverage is rising faster than assets
–Trend in cost-to-income ratio over the last two years
–Non-cash charges (ESOP, depreciation) that inflate accounting losses but not cash burn

Score anchors

9–10

Very strong

Profitable or near-profitable, positive operating cash flow, leverage manageable

7–8

Healthy

Burn declining, operating leverage improving, 18+ months runway visible

5–6

Stable

Moderate burn within industry norms, 12–18 months runway, or profitable with structural risks

3–4

Stretched

High burn relative to revenue, elevated leverage, limited runway

1–2

Critical

Severe cash burn, unsustainable capital structure, or less than 6 months runway visible

Dimension 03

Profitability Path

Measures whether there is a credible, filing-evidenced trajectory toward profitability. This is the most forward-looking of the three dimensions, but it is still anchored to what the filing shows — not what the founder says.

What raises or lowers this score

–Current PAT (positive, near-zero, or deeply negative)
–Direction of the cost-to-income ratio over two or more years
–Gross margin or contribution margin and its trend
–Whether operating leverage is visible (costs growing slower than revenue)
–Presence of large structural costs (FLDG provisions, deferred charges) that obscure underlying economics

Score anchors

9–10

Demonstrated

Profitable at PAT level with improving margins

7–8

Visible

Near break-even, contribution margin positive, operating leverage evident

5–6

Emerging

Improving metrics but path is 2–4 years out or requires significant scale

3–4

Unclear

Costs growing faster than revenue, or margin trend flat to negative

1–2

Not visible

Losses deepening relative to revenue, no operating leverage from filing data

Worked example

How the three scores are derived for one company, step by step.

Worked Example

Jar (Changejar Technologies) — FY2025

Source: AOC-4 XBRL filed with MCA

Full article →

Growth Quality

8/10

–Revenue grew 4.9× YoY (₹38.36 Cr → ₹188.78 Cr)
–No discontinued operations, no asset disposal gains
–Growth driven by core platform revenue, costs grew only 31%
–Cost-to-income ratio fell from 3.46× to 0.92×
–Score capped at 8: absolute scale still small, single FY of strong growth

Sustainability

6/10

–First-ever PAT profit: ₹13.17 Cr
–Operating costs well within revenue for the first time
–No debt disclosed; equity-funded to date
–Score held at 6: one year of profitability, cumulative losses of ₹286 Cr still on the balance sheet
–Sustainability of the revenue mix cannot be verified from XBRL alone

Profitability Path

7/10

–PAT positive in FY2025: path is no longer theoretical
–Three consecutive years of cost-to-income improvement: 9.37× → 3.46× → 0.92×
–Operating leverage demonstrated, not assumed
–Score held at 7: one data point of profitability; margin thin; scale needed to confirm

Employer Health Signal

How the Employer Check works

The Employer Health Signal assesses five dimensions of a company's financial health from the perspective of a prospective employee. Every label is derived from the audited MCA filing — not from Glassdoor, LinkedIn, or management commentary.

Dimension	Filing inputs used	What moves the label
Growth Momentum	YoY revenue from P&L, operating vs non-recurring breakdown, cost trajectory	Strong: 30%+ operating revenue growth, costs growing slower. Moderate: 10–30% or meaningful non-recurring component. Weak/Critical: <5% or revenue declining.
Stability	Cash + liquid investments, operating cash flow, monthly burn rate, debt schedule	Strong: 18+ months runway, positive OCF. Moderate: 12–18 months, OCF near-zero. Stretched: <12 months. Critical: <6 months or OCF worsening sharply.
Profitability	PAT, gross/contribution margin trend, cost-to-income ratio across 2+ years	Achieved: PAT positive with improving margins. Near Break-even: within 10% of breakeven. Loss-Deepening: losses widening relative to revenue.
Funding Dependence	Equity raise history, cash from financing vs operating activities, cumulative losses vs equity raised	Low: operating revenue covers >80% of costs. High: >50% of operations funded by equity. Critical: company cannot operate without imminent raise.
Career Upside	Revenue growth (YoY) + payroll expense trend + ESOP disclosures + sector growth	High: fast revenue growth + payroll rising + ESOP in place. Moderate: growth present, ESOP limited. Limited: flat revenue + no payroll signal.

Career Upside — detailed formula

Four inputs, all from the filing

Revenue growth (YoY)

From the audited P&L. Operating revenue only — one-time items excluded. Proxy for how fast the company is growing and whether it can sustain compensation increases.

Payroll / employee cost trend

From the notes to accounts (employee benefit expenses). A rising payroll trend signals the company is hiring and rewarding staff. A flat or declining trend post-downturn is a flag.

ESOP structure & disclosures

ESOP expense from P&L notes and any ESOP pool disclosures. We check whether ESOP is dilutive or symbolic, and whether vesting schedules are disclosed.

Sector / market tailwinds

A qualitative factor. Fintech, EV, SaaS, consumer — sectors with structural tailwinds allow more confidence in the upside label than contracting sectors.

Label reference — what each label means

Strong

Strong / Achieved / Low / High

Positive signal from filing data. Above-average financial health for this dimension.

Moderate

Moderate / Improving / Near Break-even / High Variance

Mixed or neutral signal. One direction is clear but the other has uncertainty.

Stretched

Stretched / Weak / Limited

Negative signal. Financial risk is present in this dimension from the filing.

Critical

Critical / Loss-Deepening / Declining / Uncertain

Significant financial risk flag. Requires careful evaluation before joining.

Solid

The majority of dimensions show positive labels. The financial floor is strong from the filing. Does not guarantee culture, growth, or job security — but the company is not in financial distress.

Watch

Mixed signals across dimensions. Some positives are present but at least one significant risk flag exists. Read the notes section carefully before deciding.

Caution

Multiple risk flags from the filing. Financial distress signals are present. This does not mean the company will fail, but the employment risk is elevated.

What the score does not measure

The Reality Check score is deliberately limited to what an audited annual filing can tell you. That makes it verifiable. It also means these things are outside its scope:

Team quality

Founder track record, team depth, and execution capability are not in the filing.

Market size

Whether the addressable market is large or growing is not scored.

Competitive position

How the company compares to rivals is not assessed.

Future fundraising

Whether the company will raise its next round is not predicted.

Product quality

User experience, product-market fit, and NPS are not in any filing.

Regulatory risk

Sector-level regulatory changes that could affect the business model are not scored.

Data sources

MCA AOC-4 XBRL filings

The primary source for all financial data. Audited consolidated and standalone financials filed by the company with the Registrar of Companies.

AOC-1 subsidiary annexures

Used to verify subsidiary performance and group structure disclosures.

MCA master data

Used to confirm CIN, incorporation date, registered office, and filing status.

No management commentary

Earnings calls, interviews, blog posts, and press releases are not used as data sources. If a number cannot be sourced to the filing, it does not appear in the article.

See the scores in context

Every article shows the scoring rationale alongside the raw filing data.

Browse all teardowns →