NEW DELHI – The stock of small-sized IT player Helios and MathesonBSE 0.25 % has nearly doubled in the past three months. The sharp jump follows a strong growth in revenue and profit during the September 2012 quarter. A renewed focus on banking and financial services segment in the US has helped the company to accelerate its financial performance.
Headquartered in Chennai, Helios and Matheson offersIT solutions to clients in the US in verticals including banking, financial services, and insurance (BFSI), healthcare, and manufacturing. It reported Rs 451.9 crore in revenue in the fiscal ended September 2012, a year-on-year growth of over 15%. Net profit shot up by 46.5% to Rs 29.3 crore following higher operating efficiency. Its operating margin expanded by 215 basis points to 22.2% in FY12.
The company increased its focus on the BFSI segment to take advantage of the recovery in the sector after the subprime crisis of 2008. It now caters to seven out of 10 top banks in the US. It has 22 clients that account for a billing of $1 million or more each. The company’s MD G Muralikrishna expects a steady growth in these accounts over the coming quarters. “Our clients have lined up budgets to carry out technology migration and business expansion. This should help in improving our share of their outsourcing targets,” he told ET.
The company expects to grow revenue by 30% in FY13 with better profitability. At the current price of Rs 59, the stock trades at five times its trailing 12 month net profit. Considering a 35% growth in the bottomline for FY13, its forward P/E works out to be 3.6%.
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