Buy Glodyne Tech; target of Rs 438: Firstcall Research

Firstcall Research is bullish on Glodyne Technoserve and has recommended buy rating on the stock with a target of Rs 438 in its April 19, 2012 research report.

“Glodyne Technoserve Limited is a leading Technology IMS company that has built rich experience in the geographies it serves while constantly exceeding delivery expectations of its customers. The company’s innovative delivery model helps to synchronize seamless and cost-effective solutions with assured quality to its valuable clients. It follows the best business practices that enable companies to operate more efficiently, have better ROI and help them focus on their core business. Glodyne leverages its comprehensive India and North America services footprint along with ITIL best-practice frameworks, tools and methodologies to improve availability and efficiency of its customer's Infrastructure assets.”

“In India, Glodyne has built strong skills and capabilities to provide path breaking array of technology IMS services on a managed services model in high growth sectors. Glodyne with its experience, expertise and strong IPRs has acquired a leadership position in this space. Glodyne has a strong alliance program with technology market leaders in IT Products and Services who complement its expertise in Technology IMS outsourcing and projects business. Glodyne’s success is attributed to its unique business model, a sharp organizational focus and the strength of its people. Glodyne has recently received the prestigious ‘Best under a Billion’ – Asia Pacific 2011 award by Forbes magazine. Glodyne has also received the ‘Maharashtra IT Award’ for outstanding contribution to the State. It has been a consistent winner of Deloitte Technology Fast India and Asia Pacific 2011, 2010,2009,2008,2007 and 2005 Programs.”

“Glodyne Technoserve Ltd. has reported net profit of Rs 573.49 million for the quarter ended on December 31, 2011 as against Rs 510.75 million in the same quarter last year, an increase of 12.28%. It has reported net sales of Rs 6867.16 million for the quarter ended on December 31, 2011 as against Rs 4950.79 million in the same quarter last year, a rise of 38.71%. Total income grew by 43.46% to Rs.7118.98 million from Rs. 4692.43 million in the same quarter last year. During the quarter, it reported earnings of Rs 12.75 a share.”

“At the current market price of Rs 384, the stock is trading at 7.67 x FY12E and 5.27 x FY13E respectively. Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs.50.06 and Rs.72.83 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 71% and 47% over 2010 to 2013E respectively. On the basis of EV/EBITDA, the stock trades at 3.22 x for FY12E and 2.45 x for FY13E. Price to Book Value of the stock is expected to be at 2.21 x and 1.54 x respectively for FY12E and FY13E. We expect that the company will keep its growth story in the coming quarters also. We recommend ‘BUY’ in this particular scrip with a target price of Rs 438 for medium to long term investment,” says Firstcall Research report.

Institutional holding more than 40% in Indian cos

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