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Last Updated on: 21 July, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo

Fundamental Analysis of Sonata Software Ltd

Basic Stock Data

Last Updated: July 20, 2024, 10:34 pm

Market Cap 18,564 Cr.
Current Price 662
High / Low870/469
Stock P/E45.2
Book Value 50.2
Dividend Yield1.19 %
ROCE35.5 %
ROE30.3 %
Face Value 1.00
PEG Ratio20.82

Data Source: screener.in

Competitors of Sonata Software Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Kellton Tech Solutions Ltd 1,464 Cr. 150184/72.521.4 45.50.00 %16.2 %15.7 % 5.00
CE Info Systems Ltd 12,302 Cr. 2,2752,748/1,43692.5 1210.15 %28.7 %22.3 % 2.00
Subex Ltd 1,754 Cr. 31.145.8/22.4 5.920.00 %5.48 %12.2 % 5.00
Bodhtree Consulting Ltd 15.2 Cr. 7.597.71/5.15 7.330.00 %1.62 %8.70 % 10.0
Baron Infotech Ltd 0.94 Cr. 0.920.92/0.66 0.380.00 %7.55 %% 10.0
Industry Average39,429.54 Cr727.3065.90116.780.64%20.07%19.16%6.86

Quarterly Result

MonthMar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Sales1,0761,2699631,8581,4641,7791,4962,2611,9142,0161,9132,4932,192
Expenses9731,1688401,7261,3561,6371,3412,1051,7621,8371,7152,2862,047
Operating Profit103101123132108142155156152178197208144
OPM %10%8%13%7%7%8%10%7%8%9%10%8%7%
Other Income1928141545181117252823-15555
Interest44554444721212222
Depreciation9101213131314141931333434
Profit before tax109115120130136143148155150154167-3144
Tax %24%24%24%25%26%25%24%24%24%22%25%-1,389%23%
Net Profit83879198101108113118114120124-46110
EPS in Rs2.963.093.253.483.603.844.024.204.064.284.43-1.653.94

Last Updated: July 11, 2024, 10:28 am

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: July 10, 2024, 10:03 pm

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Sales1,3111,5661,6821,9402,3712,4542,9613,7434,2285,5537,4498,613
Expenses1,2581,4651,5141,7492,1912,2232,6253,3703,8485,0906,8457,886
Operating Profit53101168192180231336373380464604727
OPM %4%6%10%10%8%9%11%10%9%8%8%8%
Other Income-51172347674730582810271-49
Interest62389531515181985
Depreciation1086611121337404759132
Profit before tax-15107182225226260349379352500597461
Tax %-93%27%27%30%31%26%29%27%31%25%24%33%
Net Profit-2878133159157192249277244376452308
EPS in Rs-1.002.774.775.665.576.878.899.888.7013.4216.1211.00
Dividend Payout %-66%51%55%60%60%57%53%76%60%58%48%103%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-20232023-2024
YoY Net Profit Growth (%)378.57%70.51%19.55%-1.26%22.29%29.69%11.24%-11.91%54.10%20.21%-31.86%
Change in YoY Net Profit Growth (%)0.00%-308.06%-50.96%-20.81%23.55%7.39%-18.44%-23.16%66.01%-33.89%-52.07%

Growth

Compounded Sales Growth
10 Years:19%
5 Years:24%
3 Years:27%
TTM:16%
Compounded Profit Growth
10 Years:19%
5 Years:11%
3 Years:19%
TTM:-9%
Stock Price CAGR
10 Years:37%
5 Years:40%
3 Years:32%
1 Year:29%
Return on Equity
10 Years:34%
5 Years:35%
3 Years:35%
Last Year:30%

Last Updated: July 17, 2024, 5:08 pm

Balance Sheet

Last Updated: July 10, 2024, 10:03 pm

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Equity Capital111111111010101010101428
Reserves3313644184605806437586598951,0891,2871,379
Borrowings1762417655341686185159590765
Other Liabilities1962793553455525457448618561,3012,4662,977
Total Liabilities5546598089921,1981,2321,5281,6161,9472,5594,3575,149
Fixed Assets2217231201181141992983244271,7321,671
CWIP000000100010
Investments225864521281981461476159220245
Other Assets5115847218209519201,1821,3051,5471,9742,4043,233
Total Assets5546598089921,1981,2321,5281,6161,9472,5594,3575,149

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity 5012777158185290-6369443450268281
Cash from Investing Activity -6-39-126-133-310412139-112-87-771-53
Cash from Financing Activity -28-41-51-30-173-140-166-310-62-271187-108
Net Cash Flow1546-100-49253-16019826893-316119

Free Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Free Cash Flow36.0095.00144.0016.00125.00197.00320.00287.00195.00305.0014.00-38.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days3949676780591006853616168
Inventory Days003300000026
Days Payable61729084968789
Cash Conversion Cycle-21-23-20-1480591006853-35-24-15
Working Capital Days-4-614219-11254-9-13-23-26
ROCE %12%28%44%42%35%39%46%51%39%44%39%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Promoters28.17%28.17%28.17%28.17%28.17%28.17%28.17%28.17%28.17%28.17%28.17%28.17%
FIIs15.46%16.56%14.00%13.71%12.87%12.96%12.84%12.95%13.59%14.98%14.47%13.94%
DIIs12.83%12.97%14.65%14.69%14.97%13.98%13.79%13.86%14.31%16.38%17.60%19.05%
Public42.35%41.11%41.99%42.25%42.81%43.69%44.09%43.94%42.87%39.41%38.71%37.80%
Others1.19%1.19%1.19%1.18%1.17%1.17%1.09%1.08%1.06%1.04%1.03%1.02%
No. of Shareholders71,72586,34690,25391,98399,1581,16,0701,10,4511,08,0151,12,6291,12,2741,55,6921,44,972

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
HDFC Small Cap Fund - Regular Plan18,679,8105.171387.444,896,4902024-07-20281.49%
HSBC Small Cap Fund - Regular Plan4,896,4902.75363.694,896,4902024-07-200%
Tata Digital India Fund3,247,9922.6241.244,896,4902024-07-20-33.67%
HDFC Childrens Gift Fund - Regular Plan2,745,3142.48203.914,896,4902024-07-20-43.93%
HSBC Value Fund2,326,0641.61172.774,896,4902024-07-20-52.5%
Nippon India Small Cap Fund1,544,0840.26114.694,896,4902024-07-20-68.47%
Aditya Birla Sun Life Digital India Fund1,533,1922.48113.884,896,4902024-07-20-68.69%
NJ Balanced Advantage Fund1,513,1332.91112.394,896,4902024-07-20-69.1%
HSBC Midcap Fund1,030,6000.8376.554,896,4902024-07-20-78.95%
ICICI Prudential Technology Fund834,6780.52624,896,4902024-07-20-82.95%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue1.001.001.001.001.00
Basic EPS (Rs.)11.1232.5836.2123.4826.66
Diluted EPS (Rs.)11.1032.5836.2123.4826.66
Cash EPS (Rs.)15.8736.8440.7827.2930.17
Book Value[Excl.RevalReserv]/Share (Rs.)50.6893.77105.7987.1564.45
Book Value[Incl.RevalReserv]/Share (Rs.)50.6893.77105.7987.1564.45
Revenue From Operations / Share (Rs.)310.38537.07534.49406.94360.28
PBDIT / Share (Rs.)30.7448.6654.4539.1841.50
PBIT / Share (Rs.)25.9844.4049.9035.3737.99
PBT / Share (Rs.)16.6343.0648.1633.8936.52
Net Profit / Share (Rs.)11.1232.5836.2323.4826.65
NP After MI And SOA / Share (Rs.)11.1232.5836.2323.4826.65
PBDIT Margin (%)9.909.0610.189.6211.51
PBIT Margin (%)8.378.269.338.6910.54
PBT Margin (%)5.358.019.018.3210.13
Net Profit Margin (%)3.586.066.775.767.39
NP After MI And SOA Margin (%)3.586.066.775.767.39
Return on Networth / Equity (%)21.9334.7434.2426.9441.35
Return on Capital Employeed (%)35.0728.0740.9736.4750.25
Return On Assets (%)5.9910.3714.7312.5317.13
Long Term Debt / Equity (X)0.300.230.000.000.00
Total Debt / Equity (X)0.470.370.030.090.12
Asset Turnover Ratio (%)1.810.540.550.650.80
Current Ratio (X)0.991.121.501.561.43
Quick Ratio (X)0.961.101.501.561.43
Dividend Payout Ratio (NP) (%)0.0051.3649.6817.03105.99
Dividend Payout Ratio (CP) (%)0.0045.4244.1314.6593.63
Earning Retention Ratio (%)0.0048.6450.3282.97-5.99
Cash Earning Retention Ratio (%)0.0054.5855.8785.356.37
Interest Coverage Ratio (X)10.0336.4131.3426.4528.41
Interest Coverage Ratio (Post Tax) (X)6.6825.3721.8516.8519.24
Enterprise Value (Cr.)19868.4211378.066956.974704.791402.35
EV / Net Operating Revenue (X)2.311.531.251.110.37
EV / EBITDA (X)23.2916.8612.3011.563.25
MarketCap / Net Operating Revenue (X)2.331.561.381.250.45
Retention Ratios (%)0.0048.6350.3182.96-5.99
Price / BV (X)14.268.936.995.842.56
Price / Net Operating Revenue (X)2.331.561.381.250.45
EarningsYield0.010.030.040.040.16

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value: 695.70

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

Undervalued: 5.09% compared to the current price 662

Intrinsic Value: 710.80

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators along with EPS growth.

Undervalued: 7.37% compared to the current price 662

Last 5 Year EPS CAGR: 2.17%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 34.92%, which is a positive sign.
  2. The stock has a low average Working Capital Days of -1.58, which is a positive sign.
  3. The company has higher reserves (738.58 cr) compared to borrowings (176.08 cr), indicating strong financial stability.
  4. The company has shown consistent growth in sales (3.08 cr) and profit (301.92 cr) over the years.
  1. The stock has a high average Cash Conversion Cycle of 17.33, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in Sonata Software Ltd:
    1. Net Profit Margin: 3.58%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 35.07% (Industry Average ROCE: %)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 21.93% (Industry Average ROE: %)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 6.68
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 0.96
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 45.2 (Industry average Stock P/E: )
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.47
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company

Sonata Software Ltd. is a Public Limited Listed company incorporated on 18/10/1994 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L72200MH1994PLC082110 and registration number is 082110. Currently Company is involved in the business activities of Other information technology and computer service activities n.e.c. Company’s Total Operating Revenue is Rs. 758.14 Cr. and Equity Capital is Rs. 10.39 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
IT Consulting & Software208, T V Industrial Estate, Mumbai Maharashtra 400030info@sonata-software.com
http://www.sonata-software.com
Management
NamePosition Held
Mr. Pradip P ShahChairman & Ind.Director
Mr. P Srikar ReddyExecutive Vice Chairman
Mr. Samir DhirManaging Director & CEO
Mr. S B GhiaNon Exe.Non Ind.Director
Mr. Viren RahejaNon Exe.Non Ind.Director
Ms. Radhika RajanIndependent Director
Mr. Sanjay K AsherIndependent Director

FAQ

What is the latest fair value of Sonata Software Ltd?

The latest fair value of Sonata Software Ltd is ₹695.70.

What is the Market Cap of Sonata Software Ltd?

The Market Cap of Sonata Software Ltd is 18,564 Cr..

What is the current Stock Price of Sonata Software Ltd as on 21 July 2024?

The current stock price of Sonata Software Ltd as on 21 July 2024 is 662.

What is the High / Low of Sonata Software Ltd stocks in FY 2024?

In FY 2024, the High / Low of Sonata Software Ltd stocks is 870/469.

What is the Stock P/E of Sonata Software Ltd?

The Stock P/E of Sonata Software Ltd is 45.2.

What is the Book Value of Sonata Software Ltd?

The Book Value of Sonata Software Ltd is 50.2.

What is the Dividend Yield of Sonata Software Ltd?

The Dividend Yield of Sonata Software Ltd is 1.19 %.

What is the ROCE of Sonata Software Ltd?

The ROCE of Sonata Software Ltd is 35.5 %.

What is the ROE of Sonata Software Ltd?

The ROE of Sonata Software Ltd is 30.3 %.

What is the Face Value of Sonata Software Ltd?

The Face Value of Sonata Software Ltd is 1.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in Sonata Software Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE