Strong order flow inspite of slowdown, low dependence on US Markets and Strong Business Model –Nucleus Software, a debt free company having over Rs 100 crores as Cash & Bank Balance looks attractive at the current market cap of Rs 170 crores.
Nucleus Software Exports Ltd.
Nucleus Software Exports Ltd. is a Delhi based company with over 20 years experience of Software development for the Banking & Financial Services industry. The company is focused on Banking, Financial Services and Insurance sectors (BFSI). The company has a 5 acres State of the Art Development Centre in Noida and employs over 2000 people. Besides Noida, the company has development centres in Singapore, Pune and Chennai.
In the mid to late nineties and early two thousands, when most players in the software industry were focusing on low risk service model focusing mainly on the US markets, Nucleus Software chose to take the High Risk model of Product Development and focused on markets in Asia and Far East, the rewards of which have been accruing to the company over the past few years. Infact, the company’s products like FinnOne and Cash@Will command leadership positions in their respective product categories, with FinnOne becoming the world’s largest selling product in its product category.
Nucleus has offices and subsidiaries across the globe – in Japan, Australia, Singapore, Netherlands, UAE, Hong Kong, Philippines and Korea. The company has four development centres globally. The company has a client list comprising of who’s who of the Banking & Financial sector.
The company has been getting various accolades and awards from time to time, recent ones being :-
a) The company’s product FinnOne has recently been ranked as World’s No.1 Selling Lending Software product by International Banking Systems (IBS), UK for the fourth consecutive year.
b) The Annual Report and Accounts of the company for year ended March 31, 2008, have been adjudged as the BEST under the category ‘Information Technology, Communication and Entertainment enterprises’ of the ‘ICAI Awards for Excellence in Financial Reporting’, by the Institute of Chartered Accountants of India (ICAI). A Gold shield will be awarded to the Company by ICAI.
c) For the third consecutive year in 2008, the Company has been selected as one of the “Top 25 Companies Adopting Good Corporate Governance Practices”, by the Institute of Company Secretaries of India (ICSI).
d) For the second year running, the Company has been listed among “Top 15 Exciting Emerging Companies to Work For” by NASSCOM. Your Company has also been recognized under “Best Practices” for Performance Management System by NASSCOM for the year 2008.
Investment Rationale:
Strong Order Flow inspite of Economic Slowdown – Inspite of the slowdown being witnessed across the globe, order flows for the company in the recent times have been strong and the company has added new customers. Nucleus bagged 8 new product orders and acquired 6 new customers for implementing 20 product modules of the FinnOne Suite & Cash@Will in the third quarter of year 2008-09. Product orders were bagged from leading financial institutions in Middle East, South East Asia, India & US. Consolidated for nine months ending December 31, 2008, Nucleus has won 20 new customers and 25 new product orders for implementing 84 modules of FinnOne™ and Cash Management Suite. The order flow continues in the Jan-Mar 09 quarter too as is evident from various announcements made by the company to the Stock Exchanges in recent months. Despite global recession, the company has not lost any clients.
Insulated from US Markets - The company derives just about 1% of its total revenues from the US markets and is largely insulated from the happenings in the US Financial markets. The company thus may not get significantly impacted by the collapsing Banks & Financial Institutions in the US.
Cash is King – The company has Cash and Bank Balance of over Rs 100 cr. The total market cap of the company currently is about Rs 170 cr. The core business is thus going at very attractive valuations. Moreover, the company carries no secured or unsecured loans on its balance sheet and is totally debt free.
The stock of Nucleus Software has fallen from a high of Rs 600 witnessed in 2007 to a current price of around Rs 50. Even though, the slowdown in the world economy and the margin pressure being witnessed by the company may be some of the factors which have taken a toll on the stock price, we feel that the stock of Nucleus Software has been battered primarily on account of the perception factor – when you think of a software company catering to the Banking & Financial Institution sector, the first thing which comes to an investors mind is US and the crumbling Banks, Financial Institutions and Insurance companies there – a closer scrutiny of the company shows that contribution from US is just about 1% of the total revenues of the company.
Besides the pressure on margins being witnessed by the company, one of the reasons for lower profits was Forex losses of Rs 9 cr in the 9 months of the current FY, which may not be of recurring nature. The company has actively taken cost cutting measures and rationalization of resources, the impact of which we believe will show in the coming quarters.
We believe that this debt free company, having Cash and Bank Balance of over Rs 100 cr available at a market cap of Rs 170 cr is attractively valued at the CMP.
Saturday, April 4, 2009
DLF - Stock Investments
About The company
DLF is the giant of Indian realty sector and has been the most admired promoter well known for its quality in work and the experience they hold.
About the present situation of the sector
The reality sector is the one , who is worst hit in this slowdown. The promoting company has to face many challenges , thereby losing the considerable part of the total income earned in the past rally. Either new projects are not launched , who were scheduled to be inaugurated and those who has already in process has negligible speed in the work progress due to lack of realization of installment and excess cancellation of bookings.
DLF Nightmare
Almost 300 buyers, who had backed out of DLF’s ‘Garden City’ project in Chennai, refused to leave its premises till they got a written assurance that their money would be paid back in full. The total number of exiters from the project was 580 out of its existing base of 1,800 customers and DLF was to give a letter outlining the timeline of refund. But people just continued waiting and and finally patience wore off and angry people refused to leave DLF premises until they got the refund letters.
DLF has now assured them that the formal refund letter addressed individually to the exiters would be given by April first and the process of full refund will commence from 1st April, 2009, and will be completed before 30 September, 2009. The priority of disbursement shall be based on the order of first exit letters received and will be intimated by 10th April 2009. Times are indeed bad but it seems to be the worst phase for realty developers.
DLF is the giant of Indian realty sector and has been the most admired promoter well known for its quality in work and the experience they hold.
About the present situation of the sector
The reality sector is the one , who is worst hit in this slowdown. The promoting company has to face many challenges , thereby losing the considerable part of the total income earned in the past rally. Either new projects are not launched , who were scheduled to be inaugurated and those who has already in process has negligible speed in the work progress due to lack of realization of installment and excess cancellation of bookings.
DLF Nightmare
Almost 300 buyers, who had backed out of DLF’s ‘Garden City’ project in Chennai, refused to leave its premises till they got a written assurance that their money would be paid back in full. The total number of exiters from the project was 580 out of its existing base of 1,800 customers and DLF was to give a letter outlining the timeline of refund. But people just continued waiting and and finally patience wore off and angry people refused to leave DLF premises until they got the refund letters.
DLF has now assured them that the formal refund letter addressed individually to the exiters would be given by April first and the process of full refund will commence from 1st April, 2009, and will be completed before 30 September, 2009. The priority of disbursement shall be based on the order of first exit letters received and will be intimated by 10th April 2009. Times are indeed bad but it seems to be the worst phase for realty developers.
Assam Company - Short Term Investments
About The Company
Assam Company is in the business of cultivation, manufacture and sale of tea. It is also engaged in the business of oil and gas exploration.
The stock has been in lime light during the boom period in the capital market and was most fancied stock among the traders.
About The Results
The company has posted results for the year ended 31st Dec 2008, the limited review shows exactly why the stock market had valued this stock in the “speculative” category. Understating its depreciation and employee costs, while overstating its segmental profits by plantation and oil and gas sectors, the company has only got deeper into the red. Its MTM forex loss for the year stood at Rs.45.33 crore, arising on account of outstanding FCCB Loan of US$ 44.70 million.
The seasonal cycle indicates that the fourth quarter is usually its best but this time, it posted a net loss during the fourth quarter. A purely “penny” trading stock and that too in the range of Rs.3-5.
About the Stock
The stock, on the bourses is considered mainly as a low priced speculative stock, allowing the investors to trade in a stock which is quoted even below its face value of Rs.10 per share. Currently quoted at levels of Rs.6, it is unbelievable that during the boom time, it had managed to touch a new high at Rs.40. Either today the 52-week highs have no relevance or today we are seeing a more realistic valuation of the stock
Assam Company is in the business of cultivation, manufacture and sale of tea. It is also engaged in the business of oil and gas exploration.
The stock has been in lime light during the boom period in the capital market and was most fancied stock among the traders.
About The Results
The company has posted results for the year ended 31st Dec 2008, the limited review shows exactly why the stock market had valued this stock in the “speculative” category. Understating its depreciation and employee costs, while overstating its segmental profits by plantation and oil and gas sectors, the company has only got deeper into the red. Its MTM forex loss for the year stood at Rs.45.33 crore, arising on account of outstanding FCCB Loan of US$ 44.70 million.
The seasonal cycle indicates that the fourth quarter is usually its best but this time, it posted a net loss during the fourth quarter. A purely “penny” trading stock and that too in the range of Rs.3-5.
About the Stock
The stock, on the bourses is considered mainly as a low priced speculative stock, allowing the investors to trade in a stock which is quoted even below its face value of Rs.10 per share. Currently quoted at levels of Rs.6, it is unbelievable that during the boom time, it had managed to touch a new high at Rs.40. Either today the 52-week highs have no relevance or today we are seeing a more realistic valuation of the stock
Gontermann Peipers India Ltd - Multiabber Info
About The Company
Gontermann Peipers India Ltd (GIP) was promoted in technical and financial collaboration with Gontermann-Peipers GmbH, Germany, a front-ranker in the manufacture of Rolls – casting and forging rolls. In 1981 the company was taken over by the Ispat Group. The promoters and their various companies hold 55.13% of the equity.
About The Results
The financial performance of the company had not been too encouraging for the second quarter and as predicted, it got only worse for the third quarter ended 31st Dec 2008. YoY, sales dipped 27%. When the beginning was bad, the ending had to suffer. It ended the quarter with a net loss of Rs.1.08 crore. OPM more than halved from 23% in Q3FY08 to around 7% in Q3FY09.
Apart from the slowdown, what really made matters worse was the minor fire that occurred in the Melting & Foundry Division of the factory on November 28, 2008 and it reopened on 1st Dec 2008. Operations were partially affected and though the company has adequate insurance cover, the loss on account of production was higher.
Source: http://www.sharetradingtips.in/
Gontermann Peipers India Ltd (GIP) was promoted in technical and financial collaboration with Gontermann-Peipers GmbH, Germany, a front-ranker in the manufacture of Rolls – casting and forging rolls. In 1981 the company was taken over by the Ispat Group. The promoters and their various companies hold 55.13% of the equity.
About The Results
The financial performance of the company had not been too encouraging for the second quarter and as predicted, it got only worse for the third quarter ended 31st Dec 2008. YoY, sales dipped 27%. When the beginning was bad, the ending had to suffer. It ended the quarter with a net loss of Rs.1.08 crore. OPM more than halved from 23% in Q3FY08 to around 7% in Q3FY09.
Apart from the slowdown, what really made matters worse was the minor fire that occurred in the Melting & Foundry Division of the factory on November 28, 2008 and it reopened on 1st Dec 2008. Operations were partially affected and though the company has adequate insurance cover, the loss on account of production was higher.
Source: http://www.sharetradingtips.in/
Wednesday, April 1, 2009
Nucleus Software Exports Ltd- Multibagger
Strong order flow inspite of slowdown, low dependence on US Markets and Strong Business Model –Nucleus Software, a debt free company having over Rs 100 crores as Cash & Bank Balance looks attractive at the current market cap of Rs 170 crores.
Nucleus Software Exports Ltd.
Nucleus Software Exports Ltd. is a Delhi based company with over 20 years experience of Software development for the Banking & Financial Services industry. The company is focused( Read the rest of this entry)
Nucleus Software Exports Ltd.
Nucleus Software Exports Ltd. is a Delhi based company with over 20 years experience of Software development for the Banking & Financial Services industry. The company is focused( Read the rest of this entry)
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