Newgen registered a whopping 109 percent on year growth in third quarter profit at Rs 18.1 crore, up from Rs 8.7 crore in same period last year.
Newgen Software Technologies shares climbed 3.8 percent in morning Friday after global research house Jefferies hiked price target on the stock after third quarter earnings.
The stock was quoting at Rs 300.00, up Rs 9.10, or 3.13 percent on the BSE, at 10:12 hours IST.
The software solutions provider's Q3 revenue growth surprised positively at 26 percent YoY in constant currency terms against estimates, Jefferies said, adding EBITDA miss slightly due to higher provision was the key negative.
The research house raised earnings estimates to factor in stronger growth and better margin. Hence while maintaining buy call on the stock, it has raised price target to Rs 375 from Rs 335 earlier, implying 29 percent potential upside from January 24's levels.
"In Q3, the revenues witnessed a 32 percent increase YoY and EBIDTA margins witnessed a significant improvement compared to the same quarter last year. The quarter saw a good mix of business from new and existing clients," Diwakar Nigam, Chairman & Managing Director at Newgen Software Technologies said.
Revenue from operations increased to Rs 160.5 crore from Rs 121.4 crore YoY with broad based growth across all key geographies and favourable foreign currency movement. "Seasonality variations across quarters are tending towards normalisation," the company said.
At operating level, EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 117 percent year-on-year to Rs 26.8 crore and margin expanded to 16.7 percent in Q3FY19 against 10.2 percent in Q3FY18.
Newgen registered a whopping 109 percent on year growth in third quarter profit at Rs 18.1 crore, up from Rs 8.7 crore in same period last year.
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