Rating upgrade from Crisil:
CRISIL Ratings has upgraded the long term ratings on the bank facilities of Intellect Design Arena Limited (Intellect) to ‘CRISIL A+/Stable’ from ‘CRISIL A/Stable’ and reaffirmed its rating of ‘CRISIL A1’ on the company’s short term bank facilities.
The upgrade reflects CRISIL Ratings’ expectation that Intellect’s business risk profile will continue to benefit from higher market acceptance and maturity of its product suites, and its strong order pipeline (over Rs.6000 crores), which will ensure healthy double digit revenue growth over the medium term. Increasing share of revenues from cloud platform, Software as a service (SaaS) and annual maintenance contract (AMC), besides cross selling of product suites and new product launches, will support revenue growth. Operating profitability is expected to sustain at healthy levels of over 20%, driven by better cost absorption through expanding scale of operations, and increase in software license revenues emanating from continued deal closures. Earlier, in fiscal 2022, revenue grew by over 25% compared to previous year, driven by timely closure of digital transformation deals. Higher contribution from license revenues (7% higher over fiscal 2021) as well as SaaS and cloud revenues (112% higher over fiscal 2021) led to improvement in operating profitability over 25 % during fiscal 2022 (from ~24% in fiscal 2021).
Read the full report here.
AJ
Disclosure: Remain invested.
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