The results’ season always springs positive surprises about some companies and this quickly gets reflected in their share prices. We are now at the conclusion of the March quarter result season and have witnessed some sectors and companies beating analysts’ expectations. Datamatics Global Services (DGS) is one such company that has announced a superb set of results for the quarter ending March 2013. Post this result the shares of the company have jumped by almost 50 per cent. This puts an investor into a quandary about whether he should take exposure in the counter due to the exceptional results or wait for an appropriate time for the stock to settle down from its sudden high.
About the Company
To arrive at any decision, we first need to understand the company and its business fundamentals. DGS is engaged in building intelligent solutions for data-driven businesses to enhance their productivity and customer experience. From FY23 the company has reclassified its business into three segments: digital technologies, digital operations and digital experiences.
1) Digital Technologies - Digital technologies include application modernisation, cloud and DevOps, artificial intelligence and cognitive services, automatic fare collection, intelligent automation mobility and portals’ business solutions and platforms, among others. This segment contributed 41 per cent to the company’s total revenue and for Q4FY23 it posted revenue of ₹170 crore with EBIT margin of 9.1 per cent.
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