ValuePickr Forum

Datamatics Global Solutions

Datamatics: CMP 55, MCAP â 321 Cr

Datamatics is a Mumbai based KPO/BPO catering to several Fortune 500 Companies globally for managing their End-to-end Application Life Cycle & Business Critical Processes With delivery centers in India at Ahmedabad, Mumbai, Nashik, Delhi, Bangalore, Chennai and Puducherry.

Datamaticsâ portfolio of integrated offerings comprises of Finance & Accounting Services, Publishing Services, Research & Analytics, Document Management Services, Information Management Services, IT Consulting, IT Services, Engineering and Embedded Services. In addition, the Company also offers a portfolio of solutions comprising of Billing & Payment Solutions, eRetail Solutions, web enablement, portal solutions, etc. The Company is also expanding its geographic footprint. The majority of Datamaticsâ revenue coming from BPO- Finance & Account; Document Processing; Publishing; Research & Analytics, Software - IT Solutions; Engineering Service and Billing Solutions.

Financials:

Consolidated Results
2009 2010 2011 2012 2013 9MFy14
Total Income 310 275 291 452 558 520
Op profit 33 12 5 40 48 54
other income 9 22 27 10 9 8
Net profit 27 22 20 28 31 45
EPS 4.3 3.7 3.5 4.8 5.3 6.3

Consolidated Results
DEC'12 Mar'13 Jun'13 Sep'13 Dec'13
Total Income 143 149 145 172 202
Op profit 10 8 13 21 19
other income 2 2.5 3.7 4 2.5
Net profit 9.8 5.6 13 16 15
EPS 1.2 0.6 1.8 2.2 2.3

SUBSIDIARIES

The Company has the following Indian subsidiaries (including

the step down subsidiaries) as on March 31, 2013:

1. Datamatics Software Services Limited

2. Datamatics Vista Info Systems Private Limited

3. CIGNEX Datamatics Technologies Private Limited

4. Cybercom Datamatics Information Solutions Limited

The Company has the following overseas subsidiaries

(including the step down subsidiaries) as on March 31, 2013:

1. Datamatics Global Services, Inc. (US).

2. Datamatics Global Services GmbH (Germany).

3. Datamatics Technologies UK Limited (UK).

4. Datamatics Infotech Limited (UK).

5. Datamatics Global Services Pty Limited (Australia).

6. Datamatics Global Technologies GmbH (Germany).

7. Datamatics Global Services GmbH d.o.o. in Bosnia

(Switzerland).

8. Datamatics Global Technologies Limited (Mauritius).

9. Datamatics Global Holding Corporation (BVI).

10. Datamatics Global Technologies AG (Switzerland).

11. CIGNEX Datamatics Corporation (BVI).

12. CIGNEX Datamatics, Inc. (US).

13. CIGNEX Datamatics Pte. Limited (Singapore).

Excerpts from AR 2012-13

Our acquisition of Cignex, two years ago was in response to the Open Source opportunity. Cignex is in âOpen Sourceâ. Cignex revenue grew from Rs 99 crores to Rs 193 crores in the 2 years after our acquisition Your company is relying upon both organic and inorganic growth. We are constantly looking for M&A targets in our business, with financial prudence. I am confident that our growth will exceed 30% in FY 2013-14 thanks to organic growth, M&As and the weakening rupee.

Positives:

Promoted by founder Director of TCS â Lalit Kanodia

Surviving from 25 years in the industry

Company is in reviving phase after a few years of challenges.

High shareholding by promoters â 72.75%

Clean balance sheet â 100cr of cash and cash equivalents (excluding 40 Cr debt) on MCP of 320 cr.

Continuously paying dividend with 2% yield and good payout ratio of 25%.

Negatives:

Last 5 years has been challenging and didnât show the growth

61% of revenue from USA.

Currency fluctuations

Talent retention

Growth is majorly from CIGNEX

Investment theme:

Of late there is a re-rating in IT/ITES sector due to rupee depreciation, increasing opportunities due to US recovery and positive outlook for next 2-3 years. This has been extended to even small cap companies like R-systems, etc. Datamatics is one company which is in the same league and trading at forward PE of 6. This seems to be a good Opportunistic bet at the CMP of around 50. Any improvement in fundamentals and consistent growth may re-rate the company to 7-8 PE help to provide good return in the medium term of 1-2 years.

Request senior valuepickrs opinion.

Discl: No positions.

Best result in 10 years of being listed clearly speaks of something.

Other staffing firms which got listed recently Quess Corp n Team Lease trading at very high PE of above 60.
Will this trigger value Unlocking in Datamatics Global which is trading very cheap at PE of around 8 has to be seen

Datamatics is not purely staffing company… is it?

Datamatics is not a staffing firm.

Datamatics revenue have not shown any growth. Also have a look at margins. Staffing companies work at low margins. Do you know of any growth triggers of this company?

Source: Screener.in

Hai can anybody throw some light on Hinduja global services is it same like datamamtics

Datamatics to acquire controlling stake of 71.1% in app development firm TechJini for $6 million. This step will strengthen its mobility offerings with TechJini’s range of smart technology solutions.

Techjini is a 12 year old firm based in Bengaluru and New Jersey having 35 clients from domains such as media, engineering and manufacturing. For the financial year 2016-17, TechJini registered a consolidated turnover of Rs 35.02 crore, the filing shows.

Personal Take: With the growth in demand for device centric businesses like IoT, mobility etc., this step could be a great value add to Datamatics, which is a global provider of consulting, information technology, data management and business process management services.

Request the opinion of the other Valuepickr’s

My personal take: Their valuation looks cheap but as a company they could not grow much in their period of industry growth. Both of their key business line Application Lifecycle (ADM) and Business Process Management (BPO) are prime candidates for disruptions due to automation and AI technologies in coming quarters. The only way companies like these will be able to protect and grow top-line will be through venturing into new area (e.g. mobility), and being able to offset revenue falls in order business through new capabilities. The acquisition may unlock some opportunistic upside in short-term but I would wait and watch at least two quarters, to consider a value pick.

Look forward to opinion of other Valuepickrs.

Disclosure: No positions.

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Recent acquisition of BPO Firm – RJ Globus Solutions:
Datamatics Global Services Corp., Step down subsidiary of the Company, has acquired 75% Stake in RJ Globus Solutions Inc, a voice based BPO Company headquartered in Manila, Philippines.
The objective of this acquisition is to further strengthen the Company’s BPO offerings to meet the growing demands of customers and increase its market presence through an expanded global delivery center.
Post-acquisition the Company will become stepdown subsidiary of the Company.
The company said it acquired 75% shares and balance 25% shares will be acquired in the year 2019 and 2020 based on the financial performance of the target Company.

Datamatics Q1 FY19 Results Update.pdf (596.2 KB)
Company heading right direction, financials improving…
Discloser: I personally hold position in the company

Datamatics Gloabal Services Limited Analysis.pdf (935.5 KB)
Company looks to be more keen on subsidiary business rather than create long term shareholder value.
Disclosure:- No Holdings.

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Datamatics Global Services Q4 Notes!



Disclaimer: Invested

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Thanks for the summary @Lajja_Shah .
Datamatics has seen phenomenal run recently in last 1 month (doubled) although no significant announcement from the company.

"With reference to your letter dated July 16, 2021 vide ref. No. L/SURV/ONL/PV/NP/ 2021-2022 / 230 received through email by the undersigned, we wish to inform that the significant movement in the share price / volume behaviour of the scrip is purely due to market conditions and are market driven. We would further like to inform you that there is significant increase in movement in the share price / volume of Mid-Cap ITeS companies in last few days.

Further, we would like to reiterate that as always, the Company will continue to inform the stock exchanges about any price sensitive information as required under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015."

Disc: Invested