The growth of Infinite Computer Solutions (India) is hard to miss
23-05-2014 • About Infinite Computer Solutions (India) (
$INFINITE) • By InTwits
Infinite Computer Solutions (India) is a fast-growing stock in IT Consulting & Software industry. It showed noticeble revenue performance in the last years among with attractive profitability and financial model.
Growth story
Infinite Computer Solutions (India) showed fast growth in the last financial year. The company's revenue surged on 24.6% in FY2014. In addition to revenue Infinite Computer Solutions (India) also keeps delivering EBITDA growth. It was -15.0% in FY2014
In the last 3 years the company showed fast revenue growth of 25.2% from FY2011 to FY2014 annually. EBITDA surged on 7.45% from FY2011 to FY2014 annually.
Infinite Computer Solutions (India) ($INFINITE) financials for the last 5 years
| mln. INR | FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Revenue | 20,976 | 8,833 | 10,558 | 13,906 | 17,327 |
|---|
| Revenue growth, % | | -57.9% | 19.5% | 31.7% | 24.6% |
|---|
| SG&A, % | | | | | |
|---|
| EBITDA | 1,231 | 1,496 | 2,014 | 2,184 | 1,856 |
|---|
| EBITDA growth, % | | 21.5% | 34.6% | 8.5% | -15.0% |
|---|
| EBITDA margin, % | 5.87% | 16.9% | 19.1% | 15.7% | 10.7% |
|---|
| Net Income | 792 | 1,072 | 1,207 | 1,307 | 898 |
|---|
| Net Income margin, % | 3.77% | 12.1% | 11.4% | 9.40% | 5.18% |
|---|
| |
| CAPEX | 467 | 1,198 | 482 | 795 | 367 |
|---|
| CAPEX/Revenue, % | 2.23% | 13.6% | 4.56% | 5.71% | 2.12% |
|---|
| Debt | 609 | 518 | 591 | 859 | 623 |
|---|
| Cash | 479 | 189 | 709 | 1,556 | 1,036 |
|---|
| Net Debt/EBITDA | 0.1x | 0.2x | -0.1x | -0.3x | -0.2x |
|---|
| |
| ROIC, % | 41.1% | 29.3% | 28.7% | 23.8% | 15.3% |
|---|
| ROE, % | 33.0% | 28.8% | 26.1% | 23.7% | 14.1% |
|---|
Profitability and return on investment
EBITDA growth was partly attributed to margin expansion. In the longer period EBITDA margin dropped on 6.20 pp from 16.9% in FY2011 to 10.7% in FY2014.
We call Infinite Computer Solutions (India) an attractive growth stock as together with the growth it delivers high ROIC at 15.3%. During the last three years it dropped - it was 29.3% in FY2011. Average ROIC for the last three years was 22.6%.
Infinite Computer Solutions (India) showed big decline in Net Income margin of 4.20 pp from 9.40% to 5.20% in FY2014. In the longer period Infinite Computer Solutions (India)'s Net Income margin dropped on 6.90 pp from 12.1% in FY2011 to 5.20% in FY2014.
Infinite Computer Solutions (India) operates at ROE of 14.1%. For the last three years the average ROE was 21.3%.
Capital expenditures (CAPEX)
In FY2014 the company had CAPEX/Revenue of 2.12%. Infinite Computer Solutions (India) showed big decline in CAPEX/Revenue of 11.4 pp from 13.6% in FY2011 to 2.12% in FY2014. It's average level of CAPEX/Revenue for the last three years was 4.13%.
Leverage (Debt)
Having such a fast growth profile Infinite Computer Solutions (India) keeps negative net debt at -0.2x Net Debt/EBITDA. In the last 3 years Infinite Computer Solutions (India) showed big decline in leverage of 0.44x from 0.22x in FY2011 to -0.22x in FY2014.
Valuation vs. comparable companies
The market closed today at 2.5x EV/EBITDA for Infinite Computer Solutions (India) which is 84.1% lower than 16.0x IT Consulting & Software peer group avearge calculated on the basis of 102 companies. The company trades at 5.7x P/E which is 35.8% lower than 8.9x IT Consulting & Software industry avearge calculated based on 5 companies.
Peers in IT Consulting & Software
Below we provide Infinite Computer Solutions (India) benchmarking against other companies in IT Consulting & Software industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tech Mahindra ($TECHM) | | -85.8% | 6.8% | 25.2% | 174.0% |
| Tata Consultancy Services ($TCS) | | 24.3% | 31.0% | 28.8% | 29.9% |
| Mindtree ($MINDTREE) | | -65.0% | 26.6% | 23.2% | 28.8% |
| Infosys ($INFY) | | 20.9% | 22.7% | 19.6% | 24.2% |
| Sqs India Bfsi ($SQSBFSI) | | -66.5% | 46.4% | 32.9% | 20.4% |
| |
|---|
| Median (15 companies) | | -54.6% | 27.3% | 21.9% | 16.0% |
|---|
| Infinite Computer Solutions (India) ($INFINITE) | | -57.9% | 19.5% | 31.7% | 24.6% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| Tata Consultancy Services ($TCS) | | | | | 47.4% |
| Infosys ($INFY) | 42.7% | 45.3% | 41.3% | 98.1% | 35.9% |
| Wipro ($WIPRO) | 31.8% | 31.5% | 29.2% | 30.4% | 32.0% |
| |
|---|
| Median (3 companies) | 42.7% | 34.7% | 32.7% | 36.2% | 35.9% |
|---|
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Oracle Financial Services Software ($OFSS) | 20.7% | 37.4% | 35.3% | 35.2% | 37.4% |
| Tata Consultancy Services ($TCS) | 29.0% | 29.9% | 29.5% | 28.6% | 30.7% |
| Infosys ($INFY) | 34.4% | 32.5% | 31.6% | 27.9% | 26.3% |
| Wipro ($WIPRO) | 8.3% | 21.1% | 19.1% | 20.9% | 22.4% |
| Tech Mahindra ($TECHM) | 3.1% | 19.5% | 16.7% | 20.7% | 22.2% |
| |
|---|
| Median (14 companies) | 6.6% | 19.3% | 16.0% | 18.5% | 19.6% |
|---|
| Infinite Computer Solutions (India) ($INFINITE) | 5.9% | 16.9% | 19.1% | 15.7% | 10.7% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Niit Technologies ($NIITTECH) | 1.7% | 4.1% | 5.9% | 4.6% | 6.1% |
| Infosys ($INFY) | 3.7% | 4.7% | 4.9% | 5.2% | 5.5% |
| Mindtree ($MINDTREE) | 1.1% | 5.6% | 2.5% | 4.5% | 5.0% |
| Tech Mahindra ($TECHM) | 1.1% | 3.0% | 5.4% | 2.6% | 5.0% |
| Geometric ($GEOMETRIC) | 1.7% | 3.8% | 3.5% | 4.2% | 4.0% |
| |
|---|
| Median (14 companies) | 1.2% | 4.0% | 3.8% | 3.5% | 3.6% |
|---|
| Infinite Computer Solutions (India) ($INFINITE) | 2.2% | 13.6% | 4.6% | 5.7% | 2.1% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tata Consultancy Services ($TCS) | 44.7% | 47.1% | 48.6% | 48.4% | 50.2% |
| Tech Mahindra ($TECHM) | 31.4% | 19.2% | 15.4% | 20.1% | 43.0% |
| Geometric ($GEOMETRIC) | 25.4% | 19.6% | 29.9% | 46.4% | 41.1% |
| Mindtree ($MINDTREE) | 26.4% | 14.9% | 24.9% | 34.6% | 36.2% |
| Cmc ($CMC) | 32.0% | 31.5% | 26.2% | 33.2% | 35.3% |
| |
|---|
| Median (16 companies) | 25.9% | 20.5% | 20.1% | 24.1% | 23.9% |
|---|
| Infinite Computer Solutions (India) ($INFINITE) | 41.1% | 29.3% | 28.7% | 23.8% | 15.3% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| 3I Infotech ($3IINFOTECH) | 4.1x | 3.5x | 8.5x | 20.3x | 27.7x |
| Kpit Technologies ($KPIT) | 0.2x | -0.7x | 0.3x | 0.5x | 0.7x |
| Mindtree ($MINDTREE) | -0.1x | -0.1x | -0.0x | -0.2x | -0.2x |
| Geometric ($GEOMETRIC) | 0.1x | -0.0x | 0.1x | -0.0x | -0.2x |
| Cmc ($CMC) | -0.1x | -0.2x | -0.2x | -0.4x | -0.3x |
| |
|---|
| Median (14 companies) | -0.0x | -0.2x | -0.2x | -0.3x | -0.6x |
|---|
| Infinite Computer Solutions (India) ($INFINITE) | 0.1x | 0.2x | -0.1x | -0.3x | -0.2x |
