Coforge Ltd

With Q1FY16 standalone revenue of Rs. 362 crore (up 9% YoY and flat QoQ), mid-cap IT vendor NIIT Technologies reported improved standalone operating profit at Rs. 54 crore, as against Rs. 27 crore QoQ and Rs. 43 crore YoY, with operating margins jumping to 14.9% as against 7.4% and 12.9% respectively.

Since acquisition of Incessant Technologies in May 2015 is both margin and EPS accretive, consolidated June quarter revenue for the company grew 11% YoY to Rs. 641 crore, with 35% YoY growth in consolidated operating profit at Rs. 104 crore. Despite 16.3% wage hike, 8.9% sequential growth in international geographies helped maintain margins. US, which contributes to 45% of revenues, being the largest geography, posted a strong 7.7% sequential growth. BFSI grew 15.2% sequentially thanks to new insurance accounts and integration of Incessant, which also augmented company’s client count by 15 in the quarter gone by.

With a total headcount of 9,228, company is banking on the emerging digital services space, now accounts for 14% of revenues. Consolidated PAT for Q1FY16 came in at Rs. 58.5 crore, leading to EPS of Rs. 9.58, on equity of Rs. 61.06 crore. Thus, share is being discounted by PE multiple of just 12 times, based on current year earnings, even after factoring in the 11% gains witnessed on the counter on Tuesday, post announcement of results.