Allied Digital Services appeals to us as an investment candidate for a couple of reasons. First, Allied Digital Services has been on an impressive growth trajectory in the recent past. Allied Digital Services‘ 3 Yr CAGR Sales is 64.20% while its’ 3 Yr CAGR Profit is an impressive 87.53%. Allied Digital Services is virtually debt-free. At the CMP of Rs. 241, Allied Digital Services is, on the basis of the FY 2010 diluted EPS of Rs. 23.70, quoting at a PE ratio of 10.16 which is not very challenging.
Allied Digital Services reported good standalone and consolidated Q1 FY 2011 results. Allied Digital Services‘ standalone sales increased 36.53% to Rs 143.72 crores in the quarter ended June 2010 as compared to Rs 105.27 crores in the quarter ended June 2009. Allied Digital Services‘ net profit increased 43.11% to Rs. 32.20 crores in the Quarter ended June 2010 as compared to Rs. 22.50 crores in the quarter ended June 2009.
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Allied Digital’s Q-o-Q YOY Results
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Allied Digital Services‘ consolidated figures were also impressive as can be seen from the chart. Allied Digital Services consolidated EPS for the June Quarter was Rs. 7.12 which if extrapolated to the whole year works out to an EPS of approximately Rs. 28.48 for FY 2011. At that EPS, Allied Digital Services will be discounted 8.46 times.
Allied Digital Services‘ order book in the June 2010 Quarter was quite healthy and stood at Rs. 125 crores from Solutions and Rs. 440 crores from the Services. Allied Digital Services is focused on a niche and a fast upcoming business segment called “Infrastructure Management Service” (IMS) which is expected to grow at a rapid pace in the near future. IMS allows large clients to curtail their IT infrastructure cost. If IMS does take off, Allied Digital Services will be a major beneficiary given its’ track record and experience in the field.
About Allied Digital Services Ltd:
| Rs. in Cr. | Jun 2010 | Mar 2010 | Dec 2009 | Sep 2009 |
| Sales Turnover | 204.64 | 193.44 | 178.91 | 166.49 |
| Other Income | 1.62 | 1.96 | 1.58 | 0.17 |
| EBITDA | 45.78 | 41.28 | 37.25 | 34.09 |
| Net Profit | 33.39 | 31.49 | 27.69 | 25.58 |
Allied Digital Services Ltd was formed in 1995. Allied Digital Services is a Global IT Services and Solutions company that provides a range of IT Infrastructure services and solutions including managed services and physical and information security solutions to leading Indian and global corporations. Allied Digital Services has a presence in over 132 locations in India, over 40 states in the USA, through its acquisition of En Pointe Global Services.
Allied Digital Services offers services such as Remote Management Services, IT Security Solutions, Infrastructure Management Services, Technical BPO, Enterprise Solutions, Software Services and Integrated Solutions. Allied Digital Services now has a presence in the USA through the acquisition of EnPointe Global Service.
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