Another theme idea.
With e-governance in full swing in almost all states in India, and most companies having a track record of atleast 5 years, isn’t this a good time to look at some of these IT stocks?
E-governance initiatives across all states will probably go on for a long time (atleast another 5 years) and the funding, although not very steep, is very steady. Since we can expect steady returns (and who knows, maybe dividends too), does anyone have any opinion on some stocks in this area?
Anyone tracking this area? Any views on this one?
Two stocks which did come under my purview are -
ABM Knowledgware - This turned up on my pretty steep criteria screener (D/E < 1 for the last 3 years, ROCE > 20% for the last 3 years, P/B < 2, OPM > 1.5IndMedOPM, NPM > 1.5IndMedNPM, GPM > 40% and so on and so forth). As I researched it further, I found it to be one of the fastest growing companies according to ET. On the business side, they have done very well over the last 9 years, starting with the Maharashtra govt. and slowly expanding to other govts. e-governance initiatives. Currently, they proclaim themselves to be the leader in implementing e-governance initiatives across India. I reached out to them for the last 5 yrs annual reports as I couldn’t find them on their website. Anyone tracking this stock?
Tera Software: In researching the competition for ABM, Tera was one stock which was almost as consistent in financial performance (including the magnitude) and its bread-and-butter also seems to be e-governance initiatives. They were one of the companies which were empaneled in the India-wide AADHAAR project (‘empanelment’ essentially means that a certain percentage of revenues/projects have to be given to Tera - this percentage is usually confidential. At the same time, getting empaneled is not easy at all). Anyone tracking this stock.
Your views are invited.