Tanla Platforms hits 5% upper circuit as board to mull share buyback on 22 July

Tanla stock was trading up 5% from its previous close while Sensex gained 0.54% (MINT_PRINT)Premium
Tanla stock was trading up 5% from its previous close while Sensex gained 0.54% (MINT_PRINT)
 2 min read . Updated: 12 Jul 2021, 11:08 AM IST Ravindra N. Sonavane

Mumbai: Tanla Platforms Ltd's stock on Monday hit the 5% upper circuit after the firm said its board will meet on 22 July to consider a share buyback proposal.

The stock was trading at ₹886.45 on BSE, up 5% from its previous close, while India's benchmark Sensex gained 0.54% to 52669 points.

The firm said in a notice to exchanges that its board will also consider June quarter earnings on 22 July.

Tanla is a leader in the Indian enterprise messaging market with over 30% market share. The next three competitors have a combined market share below 30%. Tanla serves 1,300 enterprise clients in India and at least 6 out of 10 customers across major industries (BFSI, e-commerce, retail, social media, DTH, Pharma, government, etc.).

The company derives 60% of its revenues from top-50 customers. It added 250+ new customers in FY21 and executed its land and expand strategy very well by ensuring growth from existing deployments, cross-selling of new products and upselling of products.

The company has adopted a 'one platform' approach, under which the capabilities of Karix, Gamooga and Trubloq will be integrated with the recently launched Wisely platform for international expansion. Tanla believes that the encryption capabilities of Wisely platform will be the key differentiator as enterprises are looking for more secure means of communication. The Wisely platform is developed on Microsoft Azure. The company has so far on-boarded clients such as HDFC Bank, Union Bank of India, Axis Bank and Free Charge on the Wisely platform.

"We remain positive on the CPaaS space and medium-term growth outlook of Tanla, considering growing needs of digital communications, expanding product offerings, scope of margin expansion with product mix change and operating leverage, and healthy cash generation (negative working capital cycle and low capital intensity). We have coverage on Route Mobile (Buy; TP - Rs1,820) while do not have active coverage on Tanla," said Emkay Global in a note to its investors.

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