DATE: 04/03/2018
  • Description :

    Sagar Soft was recommended on 04/03/2018 at 86 Rs for the target of 140 Rs within 2 Yeras and today 25/05/2018 stock has touched 152 Rs means gave 76% return within 2 months

    Given target achieved. Book full profit.


    Recommendation - Buy

    Hold for 2 years

    Target: 140 Rs.


    • CMP: 86 Rs
    • BSE Code: 540143
    • Market Capital: 48 Cr.
    • Face Value: 10
    • 52 Week Low / High: 23.1/101.2
    • Book Value: 19.5
    • Price/Book Value: 4.41
    • Promoter Share Pledge – Nil (Promoter Stack Increased)
    • TTM EPS – 4.52
    • P/E – 19.04


    Part – 1 Company’s Information:

    • Sagarsoft (India) Ltd is Hyderabad based company and incorporated in the year 1996.
    • Sagarsoft (India) Ltd is engaged in the business of providing IT services, consulting, Cloud and new age technologies and next generation services. It provides business and technology solutions and technology related services to corporations
    • Industry Verticals - 20 years of Broad domain experience in serving diverse customers in the Healthcare, Pharma, Finance, Insurance, Information Technology, Retail Digital Marketing, Entertainment, Public Sector segments.
    • Technology Leadership and high rich experience in Mobility, High technology application suites, Cross platform, Cloud Service delivery across Linux, Windows & Analytic frameworks, best of breed Open Source, Web Centric and Social Media.


    Part – 2 Sagarsoft (India) Limited - Shareholding Pattern:



    Part – 3 Sagarsoft (India) Limited – Expertise

    1. Mobility Solution
    2. Enterprise Web Solution
    3. Research & Data Mining
    4. Social Media
    5. Workforce Solution
    6. Support Solution


    Part – 4 Financial Focus:


    Focus on - Financial Results March 2017:

    • During the year, company earned a revenue of Rs.1629.78 Lakhs as against Rs.1424.12 Lakhs in the previous year, which was higher by 14%.
    • Earnings before interest, tax, depreciation and amortization (EBITDA) was Rs.186.03 Lakhs against Rs.172.09 Lakhs in the previous year.
    • Profit after tax (PAT) for the year was Rs.57.04 Lakhs as against Rs.68.31 Lakhs in the previous year.



    Focus on - Financial Results December quarter 2017:

    • During the quarter ended 31-12-2017, company earned a revenue of Rs.1147.70 Lakhs as against Rs.427.51 Lakhs in the previous quarter 31-12-2016, which was higher by 168%.
    • PBT was Rs.217.77 Lakhs against Rs.27.63 Lakhs in the previous quarter 31-12-2016 which was higher by 688%.
    • Profit after tax (PAT) was Rs.131.77 Lakhs as against Rs.19.04 Lakhs in the previous quarter 31-12-2016 which was higher by 592%.


    Investment Rational:

    1. Promoter Stack has increased by 0.5 % during the year 2017.
    2. Virtually debt free company
    3. High turnover in revenue and Profitability
    4. Indian government's focused on digitalization leads opportunity for IT industries
    5. Indian IT service companies have expanded their service mix to areas like systems integration, network management, packaged software implementation and areas of products and technological services.
    6. Company focus and opportunities available in the industry especially in Socia Computing, Mobility, Analytics & Cloud to further catalyze company’s growth.
    7. The IT Industry is constantly evolving with new technologies and rapid automation
    8. Company continues to offer a wide range of technology related services through it’s innovate delivery center and talented professionals, with a sharp customers’ specific focus.
    9. As the IT companies intensify their focus on the digital technology space, revenue from theHowever, pressure on billing rates and rising wages in the hunt for high quality resources, is likely to hit the profit margins
    10. Indian IT industry is expected to increase steadily in both exports and domestic segments.However, pressure on billing rates and rising wages in the hunt for high quality resources, is likely to hit the profit margins.



    • Stock CMP is 86 Rs. and based on all above investment points, stock may touch 140 Rs. Within 2 years’ time horizon.




    Please note:

    • Note: The articles are not research reports but assimilation of information available on public domain and it should not be treated as a research report. Registration status with SEBI: I am not registered with SEBI under the (Research Analyst) regulations 2014 and as per clarifications provided by SEBI: “Any person who makes recommendation or offers an opinion concerning securities or public offers only through public media is not required to obtain registration as research analyst under RA Regulations” Disclosure: It is safe to assume that I might have the discussed companies in my portfolio and hence my point of view can be biased. Readers should consult registered consultants before making any investments.