Shares of Sonata Software climbed over 3 percent to hit an intraday high of Rs 649 apiece on November 28, following the announcement of a multi-million-dollar modernisation deal in Australia with a leading access solutions client.
The transformative deal involves streamlining and standardising the client’s APAC business processes across 13 countries, ensuring real-time collaboration and enhanced operational efficiency across their value chain of customers, suppliers, distributors, and partners, according to the company.
Highlighting the partnership, Anthony Lange, Chief Revenue Officer of Sonata Software said, "Our focus will be on automating end-to-end processes using Microsoft’s cutting-edge technology stack to enhance scalability and ensure seamless adoption for our client."
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In the September quarter, Sonata Software posted a muted 0.9 percent year-on-year growth in net profit, accompanied by a 14 percent decline in total revenue. The company’s international business showed resilience, with revenue rising to Rs 707.9 crore from Rs 687.8 crore in the same period last year, while domestic revenue fell sharply to Rs 1,461.9 crore from Rs 1,849.4 crore. Notably, earnings before interest and tax (EBIT) improved 1.1 percent to Rs 144.3 crore, with margins strengthening to 6.7 percent from 5.7 percent in the prior quarter.
Despite today’s rally, Sonata Software’s stock has underperformed, declining over 14 percent year-to-date, compared to the Nifty 50’s 10 percent rise. Earlier this year, the stock hit its 52-week high of Rs 867 per share on February 27, 2024.
Among analysts, the sentiment remains largely positive, with 7 brokerages covering the stock. Of these, 5 have issued a “buy” recommendation, while 2 maintain a “hold” rating.
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