Mehabe score: 7 G Factor: 5 Piotski Score: 8 The stock has a rating . The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 5 and Piotski score of 8.
Description
Oracle Financial Services Software Ltd provides financial software, custom application development, consulting, IT infrastructure management, and outsourced business processing services to the financial services industry. The company was incorporated in 1989 and is based in Mumbai, India. Oracle Financial Services Software Limited is a subsidiary of Oracle Global (Mauritius) Limited.
Main Points
Products and Services
Products – Software Solutions in the Banking and Insurance sector; Analytical Application Products; Financial Crime Compliance Management ProductsSite:OFSSMain Symbol:OFSS
Stock trades at 3721.0, above its 50dma 3550.2. It also trades above its 200dma 3302.49. The stock remains bullish on techicals
The 52 week high is at 3795.00 and the 52week low is at 2732.35
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
-Stock is providing a good dividend yield of 5.38%.
– has a good return on equity (ROE) track record: 3 Years ROE 26.67%
– has been maintaining a healthy dividend payout of 67.80%
Weakness
– The company has delivered a poor sales growth of 3.82% over past five years.
Competition
– The industry trades at a mean P/E of 31.1x. Happiest Minds trades at the industry’s max P/E of 108.62x. OFSS trades at a P/E of 18.2x
– Industry’s mean G-Factor is 3.9 while the mean Piotski score is 9.0. OFSS has a G-Factor of 5 and Piotski scoreof 8.
– Average 1 month return for industry is 14.3%. The max 1- month return was given by Happiest Minds: a return of 33.84 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 1211.0 cr compared to Rs 1264.0 cr for period ended Mar 2020, a fall of 4.2%
Operating Profits reported at Rs 590.0 cr for period ended Mar 2021 vis-vis 565.0 for period ended Mar 2020 .
Operating Margins expanded 402.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 53.49 compared to Rs 49.94 for previous quarter ended Dec 2020 and Rs 31.35 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 4984.0 cr for period ended Mar 2021 vis-vis sales of Rs 4861.0 cr for the period ended Mar 2020, a growth of 2.5%. The 3 year sales cagr stood at 3.3%.
Operating margins expanded to 50.0% for period ended Mar 2021 vis-vis 46.0% for period ended Mar 2020, expansion of 400.0 bps.
Net Profit reported at Rs 1762.0 cr for period ended Mar 2021 vis-vis sales of Rs 1462.0 cr for the period ended Mar 2020, rising 17.0%.
Company recorded a healthy Net Profit CAGR of 12.5% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 1920.0 cr for period ended Mar 2021 vis-vis Rs 1522.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 26.0% compared to 27.0% over the last 3 Years. – The stock has given a return of 30% on a 1 Year basis vis-vis a return of -1% over the last 3 Years. – The compounded sales growth on a TTM bassis is 3% vis-vis a compounded sales growth of 3% over the last 3 Years. – The compounded profit growth on a TTM basis is 20% vis-vis a compounded profit growth of 13% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 10.61% vis-vis 11.04% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 8.11% vis-vis 7.65% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free.
-Stock is providing a good dividend yield of 5.38%.
– has a good return on equity (ROE) track record: 3 Years ROE 26.67%
– has been maintaining a healthy dividend payout of 67.80% – The company has delivered a poor sales growth of 3.82% over past five years.
