Sharekhan's research report on Intellect Design Arena
Reported revenues stood at Rs. 605 crore, down 1.2% q-o-q/up 8.8% y-o-y on a like to like basis, missing our estimates of Rs. 625 crore, impacted by postponement of a Rs. 30 crore deal. EBITDA margin fell 233/409 bps q-o-q/ y-o-y to 20% missing our estimates of 23.3%.Deal pipeline remains strong at Rs. 8,526 crores, up 4.8% q-o-q/17.8% y-o-y.. Company reiterated revenue growth of 15% for FY25 after adjusting for GeM and internally expects to reach 30%+ EBITDA margins in 6-8 quarters as partnerships start yielding results.
Outlook
We maintain Hold rating with a revised PT of Rs. 1050 on the back of strong pipeline and increasing traction from AI/ML offerings. At CMP, the stock trades at 33/22x its FY25/26E EPS.
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