Stock Ideas - R Systems International: High Dividends, Strong performance
R Systems, founded in 1993, is a specialised IT and ITeS solutions provider, spanning five verticals which include telecom & digital media, banking & finance, healthcare services, manufacturing & logistics and government services. It serves customers worldwide using a global delivery model, 2,500+ expert associates and multi-language support capability. It has the industry’s highest quality certifications and standards, including SEI CMMI Level 5, PCMM Level 5, ISO 27001:2005 and ISO 9001:2008.
R Systems is a strong player providing software solutions for the banking & finance sector under the brand name Indus Solutions. According to the company’s annual report, “One of the leading Swiss banks offering a wide range of products including loans, leasing, credit cards and savings products has selected R Systems to implement a project to upgrade its key front-end applications.”
For the quarter ended September 2014, R Systems’ quarterly revenues were Rs79.65 crore (Rs73.41 crore), up 8.5%, and its quarterly profits were Rs26.42 crore (Rs12.73 crore), up 107.54%. For the year ended December 2013, R Systems’ annual revenues were Rs269.80 crore (Rs228.93 crore), a rise of 17.85%, and its annual profits were Rs36.55 crore (Rs20.53 crore), a stupendous jump of 78.03%.
The promoters of the company hold 50.59% shares and 49.41% is with retail investors and the general public. R Systems is a small company that has not yet appeared on the radar of domestic fund managers and institutional investors.
The board members of R Systems have excellent academic backgrounds. Satinder Singh Rekhi, who is the managing director, founded R Systems in 1993. He graduated with a BTech degree from IIT, Kharagpur, and has a MBA from California State University, Sacramento. Over the past five quarters, the average growth in revenues of R Systems was 19% and the average growth in operating profit was 117%. The average operating margin is a healthy 24%. The return on net worth was 19% and return on capital employed was 27%.
R Systems distributed dividend of 235% for January-December 2014. For the two previous financial years, the dividends distributed were 205% and 235%, respectively. On 26 February 2014, there was a stock split—from Rs10 to Re1. The book value is Rs14.66. Valuation is reasonable. Its market-capitalisation is 2.21 times sales and 9.03 times operating profit.
From a 52-week low of Rs32.11 on 6 November 2013, the share price had risen to a 52-week high of Rs68 on 24 December 2014. The share was trading at around Rs68 on 7th December 2014 and is an attractive buy for the long term at this price.
R Systems, founded in 1993, is a specialised IT and ITeS solutions provider, spanning five verticals which include telecom & digital media, banking & finance, healthcare services, manufacturing & logistics and government services. It serves customers worldwide using a global delivery model, 2,500+ expert associates and multi-language support capability. It has the industry’s highest quality certifications and standards, including SEI CMMI Level 5, PCMM Level 5, ISO 27001:2005 and ISO 9001:2008.
R Systems is a strong player providing software solutions for the banking & finance sector under the brand name Indus Solutions. According to the company’s annual report, “One of the leading Swiss banks offering a wide range of products including loans, leasing, credit cards and savings products has selected R Systems to implement a project to upgrade its key front-end applications.”
For the quarter ended September 2014, R Systems’ quarterly revenues were Rs79.65 crore (Rs73.41 crore), up 8.5%, and its quarterly profits were Rs26.42 crore (Rs12.73 crore), up 107.54%. For the year ended December 2013, R Systems’ annual revenues were Rs269.80 crore (Rs228.93 crore), a rise of 17.85%, and its annual profits were Rs36.55 crore (Rs20.53 crore), a stupendous jump of 78.03%.
The promoters of the company hold 50.59% shares and 49.41% is with retail investors and the general public. R Systems is a small company that has not yet appeared on the radar of domestic fund managers and institutional investors.
The board members of R Systems have excellent academic backgrounds. Satinder Singh Rekhi, who is the managing director, founded R Systems in 1993. He graduated with a BTech degree from IIT, Kharagpur, and has a MBA from California State University, Sacramento. Over the past five quarters, the average growth in revenues of R Systems was 19% and the average growth in operating profit was 117%. The average operating margin is a healthy 24%. The return on net worth was 19% and return on capital employed was 27%.
R Systems distributed dividend of 235% for January-December 2014. For the two previous financial years, the dividends distributed were 205% and 235%, respectively. On 26 February 2014, there was a stock split—from Rs10 to Re1. The book value is Rs14.66. Valuation is reasonable. Its market-capitalisation is 2.21 times sales and 9.03 times operating profit.
From a 52-week low of Rs32.11 on 6 November 2013, the share price had risen to a 52-week high of Rs68 on 24 December 2014. The share was trading at around Rs68 on 7th December 2014 and is an attractive buy for the long term at this price.
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1 comments:
start a chat room either or how can we get calls?please show us ways!
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