Thanks vnkt
Quick thoughts – Given the change in depreciation policy, I am now evaluating the company on EV/EBITDA multiple for a fair like to like comparison over previous years.
- The liabilities seem to have suddenly increased in higher proportion to sales growth – 10+cr in lease liabilities in Sep’23 ( ~5 cr as of Mar’23 and 1 cr in Mar’22). Need to understand these
- QoQ rev growth is ~ 10% (good IMO), ~ 31% YoY (would have preferred more at this scale).
- Need to spend time and calculate GMs and GM trends in detail (hopefully they are stable).
Overall, the company is available (As of today CMP) at EV of ~ 750 cr (780 cr mcap, 17 cr debt and 41 cr cash). For a TTM Ebitda of 40 cr, the company is available at <20x which to me is a reasonable valuation. I will continue to track quarterly results and hold if the trends sustain. Profitable SaaS companies should command anywhere between 30-50x ebitda depending on multiple factors (market size, competition, moat, margins, cust retention etc).
Disc : Invested at below 200 rs, >5% portfolio size so views are very likely to be biased.
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