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ICICI Direct has buy call on with a target price of Rs 875. The current market price of Intellect Design Arena Ltd. is Rs 713.95.
Intellect Design Arena Ltd., incorporated in the year 2011, is a Small Cap company (having a market cap of Rs 10064.16 Crore) operating in IT Software sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 400.38 Crore, up 3.61 % from last quarter Total Income of Rs 386.43 Crore and up 10.91 % from last year same quarter Total Income of Rs 361.01 Crore. Company reported net profit after tax of Rs 73.92 Crore in latest quarter.
Investment Rationale
Improving deal wins in IGCB, IGTB and iSEEC, increased penetration in the US & Europe market, digital-ready product portfolio, healthy pipeline, huge addressable & underpenetrated market and improved annuity revenues bode well for revenue growth. In addition, healthy margins prompt the brokerage to revise their EPS estimates upwards by ~10% and ~13% for FY22E & FY23E, respectively. This, coupled with improving cash flows, prompts them to upgrade the stock from HOLD to BUY with a revised target price of Rs 875 (6x FY23E price/sales and 25x FY23E EPS) (earlier target price Rs 640).
Intellect Design Arena Ltd., incorporated in the year 2011, is a Small Cap company (having a market cap of Rs 10064.16 Crore) operating in IT Software sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 400.38 Crore, up 3.61 % from last quarter Total Income of Rs 386.43 Crore and up 10.91 % from last year same quarter Total Income of Rs 361.01 Crore. Company reported net profit after tax of Rs 73.92 Crore in latest quarter.
Investment Rationale
Improving deal wins in IGCB, IGTB and iSEEC, increased penetration in the US & Europe market, digital-ready product portfolio, healthy pipeline, huge addressable & underpenetrated market and improved annuity revenues bode well for revenue growth. In addition, healthy margins prompt the brokerage to revise their EPS estimates upwards by ~10% and ~13% for FY22E & FY23E, respectively. This, coupled with improving cash flows, prompts them to upgrade the stock from HOLD to BUY with a revised target price of Rs 875 (6x FY23E price/sales and 25x FY23E EPS) (earlier target price Rs 640).
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