I would agree. Stock appears growth with value.

 

                Prithvii Information  - 4 lacs to Rs 300 crores in 8 years

 

Prithvii Information (CMP Rs 327) does appear value with growth. They have grown really big over the last 8 years. In 1999 they started with 25 people, did a turnover of Rs 4 lacs and should do about Rs 450 crores in the current year.

 

Company is into enterprise application software and has diversified into e-governance, radio frequency engineering and optimization works for the telecom industry, business intelligence, data warehousing, data mining etc..

 

The company is run by a lady entrepreneur “Madhavi Vuppalapati” Interestingly the top management of the company are all technocrats Ms Madhavi is a Carnegie Mellon graduate and her brother V Satish Kumar is an IIT Alumni.

 

Prithvii Information employs 700 professionals and this number should go up as well. The company covers the BFSI, manufacturing retail and pharmaceutical areas. The company wants to enter the process outsourcing and strategic consulting arenas In addition to this they intend to provide end-to-end solutions in various segments.

 

C.M.P	Rs 328
Market Capitalization	Rs 592.39 crores
Sales Fy 06	Rs 310 crores
Net Profit FY 06	Rs 28.68 crores
Sales FY )7 Q!	Rs 139.82 crores
Net profit FY 07 Q1	Rs 18.48 crores
EPS FY 07 Q1 (Not annualized)	Rs 10.22

 

The financials look phenomena stock trades at less then 8 times current year earnings (first quarter EPS annualized). I do not understand small software companies but the kind of vision I was able to read at the company’s website and the scorching pace at which this company has grown over the last 7 years makes me believe that this company should very well and remains a value cum growth buy..

Thanks for your input.You know I have always felt that except for the big boys Infy, Wipro, Satyam TCS and HCl tech nothing has evolved over the long term. There was a lot of chatter about geometric, Infotech,Polaris but they werre just not able to reach the desired scale. 

Sajan/Basant,

How do you compare 3i and Nucleus management. Though they have comparable valuations, I seem to prefer 3i because of their icici leneage. Also, 3i product revenue hasw grown faster than their services revenue.

How about niche players like Geometric and tata elxsi.



Edited by nav_1996 - 14/Mar/2010 at 1:14am

Basant,

I was able to pick up some Tata Elxsi at 150 so it provided margin of safety, good div yield, Tata Brand and interesting areas like animation & product design. Also % of low margin business(System Integration) has gone down. So overall I like the company but I am not very comfortable about it at current prices (230).

Also I don't see this becoming a typical multi-bagger as Tata Group is too big to focus on some thing like Tata Elxsi.

But may be 15%-20% compounder for a couple of years.








Edited by nav_1996 - 14/Mar/2010 at 1:14am