Datamatics Global Solutions

sridhar · March 2, 2014, 2:32pm

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.

nooreshtech · March 4, 2014, 8:39am

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

calmabhi23 · July 14, 2016, 7:58am

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

paresh.sarjani1 · July 14, 2016, 9:15am

Datamatics is not purely staffing company… is it?

Gaurav_Agarwal · July 14, 2016, 7:09pm

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

indirachitra · July 15, 2016, 1:47am

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

parthc · July 5, 2017, 5:55am

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

rajibs · July 5, 2017, 6:13am

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.

pgramle · May 30, 2018, 5:38am

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.

pgramle · August 22, 2018, 6:55am

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

gurjeev · December 2, 2018, 10:24am

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.

gurjeev · August 27, 2019, 10:26am

Lajja_Shah · June 1, 2021, 3:09am

Datamatics Global Services Q4 Notes!

Disclaimer: Invested

anekmmm · July 19, 2021, 6:23am

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

Lajja_Shah · October 29, 2021, 6:46am

Lajja_Shah · August 9, 2022, 6:32am

Datamatics Global Services Ltd Q1 FY23 Update!
Revenue growth of 15% expected in FY23 with stable margins!!!

Lajja_Shah · November 14, 2022, 10:10am

Future Commentary by Management:

Strong Pipeline in India & USA for AFC.
Margins have reduced due to increased salaries and cyclicality in business.
Margins drop is seen across the industry. But margins to remain stable in H2FY23.
Tax rate to be in the range of 20-22% for the rest of the year.
2 major contracts for AFC, Kolkata and NCRTC will start showing revenue from Q3 FY23.
Revenue growth in this year of about 15% is guided.
Employee cost will not be very high from this juncture as market is cooling off and are able to adjust the price hikes against customers.
EBITDA Margins expected to be 15-16% and EBIT Margins 12-13%.

Lajja_Shah · January 19, 2023, 8:29am

Margin/Revenue Guidance:

FY24 revenue guidance to be expected in the same range as FY23 around 15%.
Margins are expected to increase. But margins this year seem to be the base margin.
Guidance of revenue was about 15% in Q2 FY23 but it has already grown 17.5% in 9MFY23. For the rest of the year the 17.5% will be maintained.
Future Focus on Products and Platforms, AFC, Increased Account Penetration, Investment in Branding & Marketing.
Digital Operations Margins should be back to normal levels of 23% in FY24.

axiskumar · July 17, 2023, 2:29pm

Any one know why so much fall today… lower circuit… any news that we should know

dinngap · July 17, 2023, 3:59pm

Someone tweeted as an institution off loaded and hence this fall …we have wait and watch here