Professional Documents
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Sonata Software
Steady growth, Reasonable valuations
Contents
Page No.
Niche competencies in select focused Verticals and Services ................................... 5
Key Investment thesis for the IT Services Business ........................................................................... 5
OPD for Independent Software Vendors (~29% of total IT services revenues) ................................. 6
Travel vertical (~27% of Total Revenues): Focus on Tour Operators ................................................ 7
Retail/CPG (Accounts for 26% of total revenues) : On a strong footing............................................ 8
Investing in Platformation within the focused verticals .................................................................... 9
Focus remains on new logo wins .............................................................................. 13
Strong Hiring in Senior management to aid traction ............................................... 15
Acquisitions aimed at improving IP competencies................................................... 17
Steady performance in Operating Metrics ...................................................................................... 17
Product Business (Reseller): Focus on margin expansion ........................................ 19
Growth and Margins fare well relative to Midcap peers ......................................... 21
Sonata enjoys steady EBITDA margin in the IT services business.................................................... 21
Challenges: Subscale and high client concentration ................................................ 22
High Client Concentration remains the biggest risk ........................................................................ 22
Financial Analysis ...................................................................................................... 23
Revenue growth: Expect Consolidated Revenue Growth CAGR of 13% over FY17-FY19E .............. 23
EBITDA margin expected to remain stable over FY17-FY19E .......................................................... 24
Steady FCF generation aids strong payout ratios ............................................................................ 25
Valuation and View ................................................................................................... 27
Company Background ............................................................................................... 29
Quarterly Financials ......................................................................................................................... 30
Prabhudas Lilladher Pvt. Ltd. and/or its associates (the 'Firm') does and/or seeks to do business with companies covered in its research reports. As a result investors should be aware that
the Firm may have a conflict of interest that could affect the objectivity of the report. Investors should consider this report as only a single factor in making their investment decision.
Please refer to important disclosures and disclaimers at the end of the report
IT Services business is the value driver: Though IT services business accounts for
Major shareholders 32% of total revenues, it contributed to 78% of PAT for FY17. This is led by
Promoters 32.36% higher EBITDA margins of the IT services business (Adjusted EBITDA margin at
Foreign 14.32% 17.4% as on FY17). Key focus verticals are Offshore Product engineering for
Domestic Inst. 1.57% Independent Software vendors (29% of IT services revenues), Travel with focus
Public & Other 51.75% on Tour operators (27% of IT services revenues) and Retail and CPG (26% of IT
services Revenues). Among service offerings, Sonata enjoys strong competence
in delivering solutions on Microsoft Dynamics, SAP Hybris. Key clients include
Stock Performance Microsoft, TUI Travel, Johnson and Johnson. We expect the IT services business
(%) 1M 6M 12M to grow at 11.5% CAGR (FY17-FY19E) aided by mining new accounts.
Absolute 2.3 (17.2) (4.3) Management has guided for an aspirational goal of US$200mn revenues for IT
Relative 0.9 (35.1) (21.2) services business by FY20 (which implies 18% CAGR).
Contd...4
How we differ from Consensus Key financials (Y/e March) 2016 2017 2018E 2019E
EPS (Rs) PL Cons. % Diff. Revenues (Rs m) 19,404 25,211 28,229 32,079
2018 15.4 16.2 -4.7 Growth (%) 15.4 29.9 12.0 13.6
2019 17.5 19.2 -8.8 EBITDA (Rs m) 1,919 1,923 2,207 2,520
PAT (Rs m) 1,586 1,538 1,622 1,840
EPS (Rs) 15.1 14.6 15.4 17.5
Growth (%) 137.3 (3.1) 5.5 13.4
Price Performance (RIC: SOFT.BO, BB: SSOF IN)
Net DPS (Rs) 9.0 9.0 9.3 10.5
(Rs)
250
Profitability & Valuation 2016 2017 2018E 2019E
200 EBITDA margin (%) 9.9 7.6 7.8 7.9
150 RoE (%) 35.3 31.3 30.3 31.3
RoCE (%) 29.2 24.3 24.5 26.5
100
EV / sales (x) 0.8 0.6 0.6 0.5
50
EV / EBITDA (x) 8.3 8.0 7.1 6.1
0 PE (x) 10.9 11.2 10.6 9.4
Jul-17
Jul-16
Sep-16
Jan-17
May-17
Nov-16
Mar-17
The IT services business of Sonata Software has revenues of US$122mn for FY17. We
discuss the key sub segments of the IT services business which contributed to ~32%
of Sonata Services consolidated revenues and 78% of consolidated PAT for FY17.
Sonata Software focuses on three major industry verticals in the IT services business:
Offshore Product engineering for Independent Software vendors (OPD), Travel
vertical with focus on Tour operators, Retail & Consumer Packaged Goods. The
vertical mix of revenues of the IT services business is shown below.
Others Offshore
18 Product
Engineering (ISV)
29
Retail/ CPG
26
Travel
27
Sonata has a strong footprint in Product engineering with marquee clients which
include leading global ISVs. Sonata’s services in offshore product Engineering spans
include Testing, Performance Engineering, Cloud Engineering, Mobile Engineering
and Analytics Integration. Sonata is seeing traction in enabling enterprise software
product companies to evolve into cloud-based SaaS & PaaS models. Apart from
Product Engineering, Sonata extends product support and professional services to
strategic partners. The OPD business has annual revenues of US$36.4mn and
delivered 0% CAGR over FY15-FY17. The slower growth was on account of ramp-
down of a European client (A midsized Accounting ERP software provider) owing to
Technology shift. Hence, the OPD vertical revenues declined by 9% YoY in FY16.
However, this unit has bounced back in FY17 delivering 11% USD revenue growth.
Microsoft is the largest account in the OPD vertical and also happens to be the
second largest client of the company. Sonata has hired Mr Ranga Puranik effective
May 2016 as the Chief Growth Officer. In his earlier role, Mr Ranga Puranik was the
Head of Sales at Persistent Systems, a much larger midsized IT company focused on
Product Engineering for ISVs. We believe Mr Ranga Puranik addition can help Sonata
Software expand its footing in the OPD segment. Sonata Software has ~20 clients in
the OPD vertical and we believe that ramp-up of the next set of accounts is a key
growth driver. We model the OPD business revenues to grow at 9% CAGR over
FY17-FY19E predominantly driven by mining new accounts.
Travel vertical revenues for FY17 came at US$33.4mn and have grown at 7% CAGR
over FY15-FY17 aiding new logo additions. Sonata offers a variety of solutions which
include Business Intelligence, Mobility Solutions, Omni-Channel Commerce, etc.
Sonata also has strong expertise in SAP Hybris competency for the Travel vertical.
We expect the Travel vertical revenues to grow at 9% CAGR over FY17-FY19E
predominantly driven by mining new accounts.
Sonata has focused on ‘Platformation’ and IP-led offering and has made substantial
investments on this front over the past two years. In the analyst meet held on May
31, 2017, Management classified its IP strategy in three buckets.
Sonata Accelerate: Within this, company deploys and manages the platforms
from technology partners like Microsoft and SAP for customers and businesses.
Sonata has boosted its Platformation’ journey over the past two years with both
organic initiatives as well as acquisitions. This acquisition done by Sonata on the IP
front include Halosys (enterprise mobility management platform), IBIS (supply chain
platform running on Dynamics AX solution) and Rezopia (cloud-based travel industry
software platform).
Brick and Click Platform (An IP for Retail vertical): Brick & Click enables traditional
retailers to take the leap to the digital by getting the best of store & online retail on
one seamless platform.
Rezopia – IP led offering for Travel Vertical: Sonata acquired IP platform Rezopia, a
leading cloud-based travel ERP system provider in Aug 2014. Rezopia offers a
complete end-to-end reservation, contract management, operations and distribution
system. It enables travel providers to scale revenues, reduce costs and better serve
customers via the web, social networks, mobile devices and traditional call centres.
The focused segment for Rezopia Platform include Tour operators, Online travel
agencies offering dynamic packages, Travel suppliers such as rail, activity provider
and hotels.
In our view, IP led strategy would aid Sonata improve its positioning in focused
verticals and drive new wins. However, Sonata’s mettle would be tested in its
ability to mine the new accounts won over from IP led strategy by cross-selling
other service lines.
Sonata has strong competency in select technologies which include SAP hybrid
Omni-Channel Commerce, Microsoft Dynamics AX ERP, Microsoft Azure Cloud and
JDA supply chain. The company offers customisation, implementation as well as up-
gradation services to clients. Sonata‘s strength in these service offerings (Hybris,
Dynamics AX) is the key enabler for new account wins.
Microsoft Dynamics AX: Sonata has strong relationship with Microsoft extending
over two decades. The company developed strong skills across Microsoft
technologies and has efficiently deployed them on customer engagements. Some of
Sonata’s key offerings on Microsoft stack include Enterprise Solutions on MS
Dynamics AX and CRM, Cloud solutions on Windows Azure and Office 365. Sonata's
capability to build solutions around Dynamics AX has made it a partner of choice for
many Fortune 500 ISVs and enterprises. Sonata has developed an array of solution
accelerators around Dynamics AX that help faster turnaround time and cost savings.
Sonata indicated a strong traction in Digital Services which currently accounts for
31% of total revenues. Management guided that while projects tend be smaller in
size, it benefits from providing adjacent services like Integrating Digital with legacy
applications, etc.
“Yeah absolutely, I think, while digital is a great way to enter, there is obviously
there are a lot of scope for cross-selling other services and that's really the strategy
for us. It's not just enter through digital and stay digital, but then to see at least
get one or two service lines additional into an account and that's what we are
doing and then again actually we are investing a lot more on that in terms of more
dedicated kind of a client champion and how do we want to get in, what can we do
with these accounts, so that's something we are focusing on a lot more now this
quarter onwards” Mr Srikar Reddy in Q1FY16 concall.
As with the case of small and midsized vendors, Sonata Software derives a higher
proportion of revenues from top 10 clients. As on Q4FY17, revenues from top 10
clients contributed 70% to the total revenues. Management indicated cross-selling
additional services to top 10 accounts to improve revenue stability. Revenues from
Top 10 accounts have grown at 9.4% CAGR over FY15-FY17. Key clients which are
within the Top 10 accounts are TUI, Microsoft, PennyMac etc.
Exhibit 12: % of revenues derived from top 10 clients for the IT services business
76 75
74 73 73
72 72 72
72 71
70 70 70 70
70
68 67
66
64
62
2QFY15
3QFY15
4QFY15
2QFY16
3QFY16
1QFY17
2QFY17
3QFY17
1QFY15
1QFY16
4QFY16
4QFY17
Source: Company Data, PL Research
Sonata has seen a steady rise in number of accounts contributing to annual revenues
of US$1mn per year (21 accounts in Q4FY17). We believe that further client mining
initiatives in these accounts would be aiding incremental growth. Management
indicated of beefing client partners to focus on these key accounts.
21.5 21 21 21 21 21
21
20.5 20 20 20
20
19.5 19 19
19
18.5 18 18
18
17.5
17
16.5
1QFY15
2QFY15
3QFY15
3QFY16
4QFY16
1QFY17
2QFY17
3QFY17
4QFY17
4QFY15
1QFY16
2QFY16
Aided by expansion in the sales team, Sonata has seen strong new client addition as
well. Management guided that a majority of new client wins are led by Digital
Offering (80% of our new clients wins). Sonata’s competency in IP led solutions as
well as strengths in its focus areas (Microsoft Dynamicx and SAP Hybris) are also
driving new client wins. Over the past two years, company added over 40 new
clients. While new client additions might remain strong, Sonata might also see
attrition at the tail accounts as some of the new accounts won might be for project
specific work. Management guided that over 10-15 new accounts can scale into
larger engagements. We believe mining the new accounts is the key metric to watch
over FY18-FY20 as this would aid in lowering client concentration. Our interaction
with the management indicates that Sonata’s initiatives are also focused on the
same.
Led by its focus on Digital offerings for Exhibit 14: New account additions over the past few quarters
Travel & Retail clients, Sonata software has 12
seen steady new account wins over the 10
10
past few quarters 8 8
8 7
6 6 6
6 5
4
4 3
2
2 1
0
2QFY15
3QFY15
4QFY15
2QFY16
3QFY16
1QFY17
2QFY17
3QFY17
1QFY15
1QFY16
4QFY16
4QFY17
Source: Company Data, PL Research
Mr Srikar Reddy has been the CEO of Sonata Software had seen major internal management restructuring in FY12 with Mr
Sonata Software for over six years. Most of Palem Srikar Reddy, a veteran in the company taking over as the CEO. Mr Srikar has
the turnaround in IT services business has been with Sonata since 1986, handling various functions during his tenure
been driven under his leadership (Operations, Delivery, and HR). His last role in the company was that of Chief
Operating Officer (COO) before taking over as CEO. Mr Srikar is an engineer from
REC, Tiruchirappalli, and post graduate in management from IIM, Calcutta.
The first major restructuring on the operations front was the exit from TUI JV in
October 2012. For FY12, TUI JV contributed 31.5% to the company’s total
revenues. The JV had a lower EBITDA margin (~5% for FY12) owing to the higher
onsite effort and onsite costs. The JV was making losses at the net level in FY12.
Sonata Software’s exit from the JV has helped improve the overall profitability.
This was visible with the steep improvement in consolidated PAT in FY13.
However, TUI Travel continues to remain a large client for the company as of
date.
Sonata ramped up its sales functions by hiring various senior resources with
strong credentials. Sonata has aggressively bolstered the front-end onsite Sales
team, Pre-Sales team and Hunters. We present some of the recent hires of
Sonata Software over the past 18 months.
Sonata Software has shown a solid turnaround in operating performance under the
leadership of Mr Srikar Reddy. We note that Sonata Software’s IT services segment
revenues have grown at 2.6% CQGR over the past eleven quarters. Considering the
low revenue base, we believe that Sonata has the potential to deliver accelerated
growth over FY18-FY20.
Exhibit 18: QoQ USD revenue growth of IT Services (%) Exhibit 19: IT Services EBIDTA Margins (Adjusted and reported)
Source: Company Data, PL Research* Acquisitions aided growth in Source: Company Data, PL Research
3QFY16 and 4QFY16
Adjusted EBITDA margin (%) NA NA 16.0 21.3 19.9 17.4 17.0 17.5
We analyze the key competencies of Sonata which could aid revenue growth
Traction in its Niche Services (Dynamics AX, Hybris): We see Sonata’s strong
position in these service offerings aiding client recall. With demand for Omni-
Channel Commerce in Travel and Retail verticals, Sonata could enjoy new
business opportunities in developing customised solutions on Dynamics and
Hybris.
Mining the next set of accounts: Sonata has shown steady results in client
mining over the past eight quarters. Company currently has 21 accounts which
contribute to annual revenue of US$1m as of Q4FY17 (v/s 13 accounts in
Q1FY14). We note that company has strong potential for further account
mining.
We estimate 11.5% USD revenue growth CAGR over FY17-19E as compared to 18.5%
CAGR (FY13-17). The IT Services business accounts to 32% of Sonata Software’s
revenues but contributes to 78% of PAT owing to higher EBITDA margins. We model
IT services adjusted EBIDTA margin at 17/17.4% for FY18/FY19E ( vs 17.4% for FY17).
Sonata increased focus on new technologies and products and has grown
substantially in the area of Cloud, Social and Analytics. Sonata has strategic
partnerships with leading technology providers which include Microsoft, SAP, Oracle
and Appcelerator. These relationships also serve as an advantage in accessing
emerging technology solutions for the company. Management indicated that despite
thin margins, the segment has a high RoCE of ~26% for FY17.
Sonata is able to garner a strong Exhibit 21: Major products distributed by Sonata Software
relationship with product companies like
Microsoft, IBM and Oracle owing to the
third party re-selling business. This helps
the company stay ahead on the technology
Source: Company Data, PL Research * FY14 and FY15 EBITDA for Products business includes interest on Income tax of Rs68.3mn and Rs31mn,
respectively. If we exclude this, EBITDA margins for the IT products business would be 2.6% and 3.5% respectively.
160 156
155 153 153
150 147
145 142
140 140
140
135
130
130
125
120
115
1QFY16 2QFY16 3QFY16 4QFY16 1QFY17 2QFY17 3QFY17 4QFY17
35.0%
29.5%
30.0%
25.0% 23.0%
20.0%
15.1% 15.8% 13.2% 14.9%
15.0%
8.9% 9.0% 8.3%
10.0% 6.4% 6.0%
3.4% 4.5%
5.0% 1.5% 0.8%
0.0%
-5.0% FY14 FY15 -1.2% FY16 FY17
Under the leadership of Mr Srikar Reddy, Sonata has delivered solid growth in FY14
and FY15 which is ahead of other midsized IT peers. However, Sonata has seen
slowdown in growth in FY16 owing to challenges in one of its large ISV client.
Hence, organic revenues for FY16 grew by a modest 6% YoY. Revenue growth
remained modest in FY17 as well with Sonata delivering ~9% organic USD Revenue
growth (~12% constant currency revenue growth) led by slowdown in Travel vertical.
We have modeled company to deliver 10/12.5% USD revenue growth in FY18/FY19
with mining of new accounts as the key driver for incremental growth.
21.3%
24.0%
20.1%
19.9%
19.6%
22.0%
18.5%
17.8%
17.7%
17.6%
17.4%
17.4%
20.0%
17.0%
16.5%
18.0%
15.2%
14.6%
13.70%
16.0%
14.0%
12.0%
10.0%
FY14 FY15 FY16 FY17
Source: Company Data, PL Research * NIIT Tech reports hedge gains in Revenue line and hence
boosting its reported EBIDTA margin.
Exhibit 26: USD Revenues (mn) as of FY17 Exhibit 27: IT services headcount as on Q4FY17
Source: Company Data, PL Research* Hexaware revenues are for CY17E Source: Company Data, PL Research
80%
70%
70%
60% 57%
50% 46%
42%
40%
30%
20%
10%
0%
Sonata Software Mindtree Hexaware NIIT Tech
Financial Analysis
Revenue growth: Expect Consolidated Revenue Growth CAGR of 13% over FY17-FY19E
Products 5,000 6,021 7,940 9,777 10,847 10,926 12,501 17,342 19,389 22,136
Growth (21.7) 20.4 31.9 23.1 10.9 0.7 14.4 38.7 11.8 14.2
Total Revenues 13,930 14,046 15,688 13,130 15,682 16,994 19,569 25,495 28,205 32,079
Growth (13.0) 0.8 11.7 (16.3) 19.4 8.4 15.2 30.3 10.6 13.7
As a % of revenues
Services 16.2 21.3 17.8 25.5 30.8 35.7 36.1 32.0 31.3 31.0
Products 35.9 42.9 50.6 74.5 69.2 64.3 63.9 68.0 68.7 69.0
TUI 48.0 35.9 31.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Exit from TUI JV in FY12 was a strategic positive move: In FY06, Sonata Software
entered into JV with TUI by paying Euro18mn to buy 50.01% stake in TUI Info Tek.
TUI Info Tek was a subsidiary of TUI AG, a Germany-based Leisure Travel group. TUI
Info Tek provided IT services to the parent company as well as other clients in the
Travel sector. However, owing to the higher onsite effort, the JV’s performance has
been volatile on the revenue as well as margins. Sonata Software exited TUI Info Tek
JV in October 2012 by selling its 50.01% stake to TUI Travel PLC. Although the JV
contributed 31.5% to total revenues in FY12, it was making losses at the net level in
FY12. Sonata has taken a hit of Rs580mn which led to the company reporting an
overall loss in FY13.
Steady growth over FY17-FY19E: Post this exit, Sonata Software streamlined its
focus on International IT services which led to steady acceleration in the segment’s
growth. We expect IT services to continue contributing ~30-32% to the company’s
total revenues. We model revenues from IT services USD revenues to grow at 11.5%
CAGR over FY17-FY19E. Domestic IT products business currently accounts for the
lion’s share of revenues (~68% for FY17). We expect this division to show moderate
growth (13% CAGR over FY17-FY19E). Management guided that for the products
business, the focus would be on operating metrics like EBITDA margin, working
capital cycle and ROCE. We expect overall consolidated revenues to grow at 13%
CAGR over FY17-FY19E.
Sonata’s adjusted EBITDA Margin for IT Exhibit 30: IT Services EBITDA Margins (Reported and Adjusted)
service segment is ~17.5% for FY17. This is
Reoprted EBIDTA Margin Adjusted EBITDA Margins
in line with select Midcap vendors
26.5%
26.9%
25.5%
26.3%
29.0%
25.4%
24.4%
24.2%
23.9%
23.3%
27.0%
23.2%
23.3%
22.5%
21.8%
21.7%
21.6%
21.7%
25.0%
20.3%
20.1%
23.0%
18.7%
18.0%
18.4%
17.4%
21.0%
16.7%
19.0%
15.2%
17.0%
15.0%
13.0%
1QFY15
3QFY15
4QFY15
1QFY16
2QFY16
4QFY16
1QFY17
2QFY17
3QFY17
2QFY15
3QFY16
4QFY17
Source: Company Data, PL Research
IT services:. Though reported EBITDA margins stand at ~22.7% for the IT services
business, we note that adjusted EBITDA margin stands at 17.4% for FY17. The higher
reported segmental EBITDA margin for IT services is owing to company reporting
interest income and Forex gains from hedging in the IT Services segmental margin.
Domestic products: Due to the trading nature of this business, Sonata has muted
EBITDA margins in the products business. As of FY17, the domestic products business
has ~3.5% EBITDA margin. Management guided that focus would remain on gradual
margin expansion in this business as well. This would be driven by focussing on new
technologies like cloud, security offerings etc.
Adjusted IT services EBITDA margin (%) 16.0% 21.3% 19.9% 17.4% 17.0% 17.5%
Adjusted IT products EBITDA margin (%) 2.6% 3.5% 4.4% 3.0% 3.5% 3.5%
Overall EBITDA margin (%) 6.7% 9.9% 10.0% 7.6% 7.7% 7.7%
Net Cash on Balance sheet 799 1405 2387 2375 1600 2131 1946 2189
Net cash per share 7.6 13.4 22.7 22.6 15.2 20.3 18.5 20.8
Net cash per share as a % of Mcap 5.1% 8.9% 15.1% 15.1% 10.1% 13.5% 12.3% 13.9%
Sonata Software has delivered a steady dividend payout ratio over the past six years.
For FY17, the company paid a total dividend of Rs9/sh (5.5% dividend yield).
Management guided for intent to maintain the pay-out ratio at ~50% of profits. The
company has a strong cash position, with net cash of Rs3.1bn on the balance sheet
as on Q4FY17. Debtor days remain moderate which is another key positive. Aided by
improvement in margins as well as strong dividend payout ratio, Sonata Software
has shown steady expansion in RoE, which is a key positive.
Exhibit 33: DPS of Sonata (Rs) Exhibit 34: Dividend payout ratio (%) ( Excluding dividend tax)
12.0 64.0%
10.5
10.0 9.0 9.0 9.3 62.0% 61.3% 61.0% 61.5%
60.0% 60.0%
60.0%
8.0 7.0
58.0% 56.4%
6.0 55.9%
3.7 56.0%
4.0
54.0%
1.8
2.0 0.8 52.0%
0.0 50.0%
FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Sonata Software IT services revenues came in at US$122m for FY17, delivering 18.4%
CAGR (FY13-17). We expect IT services revenues to grow at 11.5% CAGR (FY17-19E),
aided by strong traction in emerging services (Digital) as well as steady new account
wins. Owing to strong growth trajectory, steady margin and dividend, Sonata
Software can trade a respectable P/E multiples.
We study the possible target price scenarios based on sum of the parts valuation.
We assign higher P/E to the IT services earnings (11.5x FY19E EPS) and a relatively
lower P/E (7.5x FY19 EPS) to the IT products business due to the trading nature of
business and lower margins. The sum of parts yields a target price of Rs190/sh.
We have also done an EV/EBITDA-based valuation for each business (services and
products) separately. We have assigned 7.5x EV/EBITDA for the IT services business
and 5x EV/EBITDA for the IT products business. The sum of parts results in an implied
target price of Rs185/sh.
Implied EV 17,353
Sonata Software currently trades at 9.3x FY19E EPS. Superior dividend yield (5.5% at
CMP), Net cash of Rs 3.1bn on balance sheet (18% of Mcap), superior return ratios
(~31% for FY17) and moderate valuations lead us to initiate coverage with a ‘BUY’
with a target price of Rs200/sh (11.5x FY19E EPS).
Exhibit 38: Sonata Software’s one-year forward P/E Exhibit 39: Sonata v/s Mindtree (Discount/premium)
18 0.0%
15 -10.0%
12 -20.0%
9 -30.0%
6 -40.0%
3 -50.0%
0 -60.0%
-70.0%
Jul-13
Jul-14
Jul-15
Jul-16
Jul-17
Nov-13
Nov-14
Nov-15
Nov-16
Mar-14
Mar-15
Mar-16
Mar-17
-80.0%
Jul-13
Jul-14
Jul-15
Jul-16
Jul-17
Nov-13
Nov-14
Nov-15
Nov-16
Mar-14
Mar-15
Mar-16
Mar-17
P/E Mean
Mean + Std Dev Mean - Std Dev
Company Background
Quarterly Financials
Adjusted IT services EBITDA margin (%) 16.0% 21.3% 19.9% 17.4% 17.1% 17.6%
Adjusted IT products EBITDA margin (%) 2.6% 3.5% 4.4% 3.0% 3.5% 3.5%
EBITDA margin 6.7% 10.0% 9.9% 7.6% 7.8% 7.9%
PAT (Rs mn) 777 1337 1586 1537 1621 1839
APAT (Rs mn) 706 1305 1549 1460 1621 1839
Adjusted EPS 6.7 12.4 14.7 13.9 15.4 17.5
Growth (%) 135.3% 84.9% 18.7% -5.8% 11.0% 13.4%
P/E 24.0 13.0 11.3 11.1 10.5 9.3
DPS 3.7 7.0 9.0 9.0 9.3 10.5
Dividend Payout Ratio 55.8% 56.4% 62.5% 64.7% 60.0% 60.0%
Dividend Yield (%) 2.5% 4.3% 5.6% 5.6% 5.7% 6.5%
ROE (%) 19.7% 32.5% 34.5% 31.3% 30.3% 31.3%
Consolidated Balance sheet (Rs mn)
Net cash on Balance sheet 2387 2375 1600 2131 1946 2189
Net Cash per Share 22.7 22.6 15.2 20.3 18.5 20.8
Net Cash per share/Mcap 15.1% 15.1% 10.1% 13.5% 12.3% 13.9%
Notes:
Notes:
Notes:
DISCLAIMER/DISCLOSURES
ANALYST CERTIFICATION
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