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Weak Weekly Closing for the Month – Post-Market Analysis

Post-Market Analysis for July 28, 2023:

NIFTY started the day flat at 19,659. Throughout the day, the index mostly consolidated with a negative bias. After moving down to the support level of 19,600, Nifty gave a small breakdown, went to the earlier swing of 19,560 levels, and reversed back to close at 19,646, down by 13 points or 0.07%.

Nifty chart post-market report - July 28

BANK NIFTY (BNF) started the day at 45,560 with a gap-down of 118 points. Similar to Nifty, Bank Nifty also mostly consolidated within a 250-point range between yesterday’s closing and 45,300 major support levels. BNF closed at 45,468, down by 211 points or 0.46%. 

Bank Nifty chart post-market report - July 18

Nifty Realty (+1.8%) and Nifty Media (+1.38%) closed well in green, while Nifty IT (-0.8%) fell the most. 

Major Asian markets closed mixed. Germany’s DAX and France’s CAC40 are currently trading in the red, while UK’s FTSE 100 is trading in the green.

Today’s Moves

NTPC (+3.9%) was NIFTY50’s top gainer. Yesterday, the company reported the declaration of the second unit of 660 MW capacity at Barh Super Thermal Power Station.

Intellect Design Arena (+19.7%) jumped after posting strong Q1 results.


Godfrey Phillips (+8.6%) continued its up-move after the company posted a 68.6% YoY risein consolidated net profit to ₹220.97 crore for Q1.

Bajaj Finserv (-1.8%) was NIFTY50’s top loser. The company’s net profit rose 48% YoY to ₹1,943 crore in Q1 FY24.

Supreme Industries (-7.8%) fell sharply after posting weak Q1 results. 

Markets Ahead

Markets took a pause after a huge fall yesterday (monthly expiry). Nifty has given a negative closing on a weekly time frame. This is the first negative closing for Nifty after a strong rally (from 18,900 to 19,990 levels).

Nifty: The major support zone in Nifty is clearly 19,600 levels, and the important resistance now will be 19,700. A breakdown from this support can give us a target of 19,560 and 19,520, while a breakout on the upside can give us a target of 19,750 and 19,820.

Bank Nifty: The next important support level for the index is 45,300, and major resistance would be 45,600. A breakout from 45,600 can give us a target of 46,200 and a breakdown can give us a target of 45,000 and 44,800 eventually.

In the next trading session, major bearishness could hit the markets if the market moves below today’s low and a trend reversal will also be confirmed.

US gross domestic product (GDP) expanded by 2.4% annually in the April-June quarter, surpassing the expected 1.8%. Despite robust economic data from the US, crude oil futures traded lower today morning. Look out for important economic data like India’s manufacturing & services PMI, auto sales data, and others next week!

How did this week go? Are you in net profit or loss? Let us know in the comments section of the marketfeed app.

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Market News Top 10 News

Axis Bank’s Net Profit Rises 91% YoY in Q1 – Top Indian Market Updates

Here are some of the major updates that could move the markets tomorrow:

Axis Bank Q1 Results: Net profit rises 91% YoY to Rs 4,125 crore

Axis Bank reported a 91% YoY increase in net profit to Rs 4,125 crore for the quarter ended June (Q1 FY23). Its net interest income (NII) grew 21% YoY to Rs 9,384 crore during the same period. [NII is the difference between the interest income a bank earns on loans and the interest it pays depositors.] The gross non-performing assets (GNPA) ratio stood at 2.76% in Q1 FY23, compared to 2.82% in Q4 FY22. The bank’s fee income rose 34% YoY to Rs 3,576 crore in Q1.

Read more here.

L&T to sell 8 roads, transmission project to Edelweiss fund for Rs 7,000 crore

Larsen & Toubro Ltd (L&T) will sell eight operational road assets and a power transmission project to Edelweiss Infrastructure Yield Plus, a fund managed by Edelweiss Alternative Asset Advisors. The enterprise value of the assets stands at Rs 7,000 crore. The latest move is part of L&T’s asset-light strategy of exiting several non-core assets. The deal is awaiting regulatory approvals from the National Highways Authority of India (NHAI) and market regulator SEBI.

Read more here.

Tech Mahindra Q1 Results: Net profit falls 16% YoY to Rs 1,132 crore

Tech Mahindra Ltd reported a 16.4% YoY decline in consolidated net profit to Rs 1,132 crore for the quarter ended June (Q1 FY23). Its revenue from operations grew 24.6% YoY to Rs 12,708 crore during the same period. EBITDA stood at Rs 1,880 crore, up 0.2% YoY. The IT company secured new deals worth $803 million in Q1, a decline of 1.5% YoY or 20.5% QoQ. Tech Mahindra will invest in new and emerging technologies to deliver differentiated offerings.  

Read more here.

Natco Pharma’s partner gets USFDA nod for prostate cancer treatment drug

Natco Pharma Ltd’s partner Breckenridge Pharmaceutical Inc has received approval from the US Food & Drug Administration (USFDA) for generic Cabazitaxel intravenous powder. The drug is used to treat prostate cancer. As per IQVIA data, the generic version of the drug generated annual sales of $303 million (~Rs 2,417 crore) during the 12 months ended May 2022. 

Read more here.

Tata Steel Q1 Results: Net profit falls 13% YoY to Rs 7,765 crore

Tata Steel Ltd reported a 12.8% YoY (or 20.4% QoQ) decline in consolidated net profit to Rs 7,764.96 crore for the quarter ended June (Q1 FY23). Its revenue from operations grew 18.6% YoY to Rs 63,430 crore during the same period. The company produced 7.74 million tonnes (MT) of steel during the quarter, registering a decline of 1.8% YoY. The performance in Q1 was impacted by higher pet coke prices, which led to higher operating costs.

Read more here.

Intellect Design Arena’s arm secures order from Mineral Development Bank

Myanmar-based Mineral Development Bank has chosen Intellect Global Consumer Banking’s (iGCB) Intellect Digital Core to transform its banking solutions. The bank aims to open 15 branches this year. The digital transformation will provide the bank with a platform to innovate faster than its competitors. iGCB is the consumer banking arm of Intellect Design Arena Ltd, a global leader in financial technology for the banking and insurance sectors.

Read more here.

HDFC Securities partners with Equitas SFB to offer Demat, trading services

HDFC Securities has partnered with Equitas Small Finance Bank (SFB) to provide its clients with Demat account and broking investment services. With this partnership, Equitas SFB will offer its customers a “3-in-1″ account for accessing the services of HDFC Securities. All customers can now open their Demat, trading accounts for buying and selling shares and trading in futures, options, and even currencies.

Read more here.

IEX Q1 Results: Net profit rises 10% YoY to Rs 69 crore

Indian Energy Exchange (IEX) reported a 10.05% YoY increase in consolidated net profit to Rs 69.12 crore for the quarter ended June (Q1 FY23). Net profit fell 21.7% when compared to the previous quarter. Its total income rose 10.2% YoY to Rs 113.4 crore during the same period. EBITDA stood at Rs 81 crore in Q1, up 8% YoY.

Govt sets target to raise share of natural gas in energy mix to 15% by 2030

The Indian government has set a target to raise the share of natural gas in the total energy mix from 6.3% currently to 15% by 2030. Initiatives have been taken to expand the National Gas Grid from 21,715 km to about 33,500 km. Several Liquefied Natural Gas (LNG) terminals will also be established across the country. The govt will also allow marketing and pricing freedom to gas produced from high pressure/high-temperature areas, deep water & ultra-deepwater, and coal seams.

Read more here.

Macrotech Developers Q1 Results: Net profit rises 68% YoY to Rs 271 crore 

Macrotech Developers Ltd (Lodha Group) reported a 68.75% YoY increase in consolidated net profit to Rs 271.26 crore for the quarter ended June (Q1 FY23). Its total income grew 52.9% YoY to Rs 2,675.78 crore during the same period. The company reduced its net debt by Rs 450 crore to Rs 8,856 crore in Q1. 

The real estate company expects to enter into alliances to undertake joint development projects with a combined gross development value of Rs 15,000 crore in the current financial year (FY23).

Read more here.

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Market News Top 10 News

TCS Posts 7% YoY Rise in Net Profit in Q4 – Top Indian Market News

TCS Q4 Results: Net profit rises 7% YoY to Rs 9,926 crore

Tata Consultancy Services (TCS) reported a 7% YoY increase in consolidated net profit to Rs 9,926 crore for the quarter ended March (Q4 FY22). Net profit rose 1.6% when compared to the previous quarter. Its revenue from operations grew 16% YoY (or 3.5% QoQ) to Rs 50,591 crore during the same period. The IT company secured new deals worth $11.3 billion in Q4, taking the total order book to $34.6 billion for FY22. TCS’ board has declared a final dividend of Rs 22 per share for Q4 FY22.

Read more here.

Tata Motors to ramp up EV production as demand rises

Tata Motors Ltd will ramp up the production of electric vehicles (EVs) as demand continues to outpace the manufacturing activity by a large margin. The automaker has been receiving an average of 5,500-6,000 bookings in the past two months for its EV range. The company sells three electric products (Nexon EV, Tigor EV, and XPRES-T) in the domestic market. It has also recently unveiled a coupe-style SUV which it plans to launch in the next two years.

Read more here.

Godrej Industries launches Godrej Capital

Godrej Industries Ltd (GIL) announced the launch of Godrej Capital Limited (GCL). GCL will be the holding entity for Godrej Housing Finance and Godrej Finance Ltd (an NBFC). GIL has committed to invest Rs 1,500 crore as capital in the financial services arm. It expects the business to require a total equity investment of Rs 5,000 crore by 2026. With this launch, GIL aims to build a world-class retail financial services business.

Read more here.

Glenmark Pharma gets DCGI approval for Phase-1 trial of novel molecule

Glenmark Specialty S.A. has received approval from the Drugs Controller General of India (DCGI) to conduct a Phase-1 clinical trial of its novel small-molecule, GRC 54276. The molecule has shown the ability to kill tumor cells in pre-clinical studies as a single agent. Glenmark will initiate a Phase-1 clinical trial in India by June 2022. The study will evaluate the safety and tolerability of GRC 54276 as a monotherapy. 

Read more here. 

MCX to partner with Chittagong Stock Exchange to set up derivatives platform

Multi Commodity Exchange of India (MCX) is planning to collaborate with Chittagong Stock Exchange (CSE) of Bangladesh to provide consultancy services for establishing a commodity derivatives platform in the country. MCX will provide consultation services to CSE in areas of regulations, products, clearing & settlement services, warehousing, etc. CSE is one of the two stock exchanges based in the port city of Chittagong, Bangladesh.

Read more here.

Tata Steel infuses Rs 625 crore in Tata Steel Mining

Tata Steel Ltd has acquired 32.63 crore equity shares of Tata Steel Mining Ltd (TSML) at a premium of Rs 9.15 per share. The aggregate amount paid for acquiring the shares is Rs 625 crore. This equity infusion is for funding TSML’s acquisition of Rohit Ferro Tech under the Corporate Insolvency Resolution Process of the Insolvency and Bankruptcy Code.

Read more here.

HAL-L&T consortium emerges lowest bidder for ISRO project

A consortium of Hindustan Aeronautics Ltd (HAL) and Larsen & Toubro (L&T) has emerged as the lowest (L-1) bidder to make five Polar Space Launch Vehicles (PSLVs) for ISRO. HAL will be the lead partner with L&T, while other vendors will be involved with the consortium in the manufacturing of the launch vehicles. The contract is yet to be formalized.

Read more here.

Intellect Design secures digital banking contract from VPBank

Intellect Global Transaction Banking (iGTB) has signed a transformative deal with Vietnam-based VP Bank to digitize and streamline its transaction banking offerings. This deal marks the tenth key digital banking transformation deal in Vietnam. iGTB is the transaction banking specialist from Intellect Design Arena Ltd.

Read more here.

Kesoram Industries Q4 Results: Net loss at Rs 46.6 crore

Kesoram Industries Ltd reported a consolidated net loss of Rs 46.67 crore for the quarter ended March (Q4 FY22). It had reported a net profit of Rs 112.26 crore in the corresponding quarter last year (Q4 FY21). The company’s revenue rose 19.7% YoY to Rs 1,031.78 crore in Q4 FY22. Kesoram Industries is engaged in the manufacture of cement, tyres, tubes, pipes, paper, and heavy chemicals.

Read more here.

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Market News Top 10 News

RIL, TA’ZIZ Forms JV for $2 billion Chemical Projects – Top Indian Market News

Reliance, TA’ZIZ forms joint venture for $2 billion chemical projects in Abu Dhabi

Reliance Industries Ltd (RIL) has formed a strategic joint venture (JV) with Abu Dhabi Chemicals Derivatives Company RSC Ltd (TA’ZIZ) for chemical projects worth $2 billion in Ruwais. The joint venture, named TA’ZIZ EDC & PVC, will construct and operate a chlor-alkali, ethylene dichloride (EDC), and polyvinyl chloride (PVC) production facility. The JV aims to export the materials to target markets in Southeast Asia and Africa and also sell them domestically.

Read more here.

Nestle India gets approval for PLI scheme for processed fruits, vegetables

The Indian government has approved Nestle India’s proposal towards the Production Linked Incentive (PLI) scheme for processed fruits and vegetables. In June, the company had submitted its proposal for the Centre’s PLI scheme for the food processing sector under the eligible categories, i.e., ready to eat/ready to cook and processed fruits & vegetables. The Ministry of Food Processing Industries has approved 60 applications of investment proposals by packaged food companies. The list includes ITC, Hindustan Unilever, Britannia Industries, Tata Consumer Products, Amul, etc.

Read more here.

Intellect Designs Arena secures order from SBI

Intellect Design Arena Ltd (IDAL) announced that the State Bank of India (SBI) has selected Intellect Wealth Qube – Digital Wealth Management suite for its digital wealth management transformation agenda. The wealth management business is SBI’s top priority. Its primary task is to offer the best products across categories from leading fund houses, giving their customers the flexibility to invest, transact and view their portfolio through digital channels.

Read more here.

Dilip Buildcon secures order worth Rs 2,683 crore from Coal India subsidiary

Dilip Buildcon Ltd has emerged as the lowest (L-1) bidder in a tender floated by South Eastern Coalfields (SEC) for the new overburden (OB) removal contract mining work for Amadatrd OCP in Jamuna Kotma, Madhya Pradesh. The company is required to conduct an OB removal contract mining of 236.18 million bank cubic metres for a contract period of 1,795 days. The order is worth Rs 2,683.02 crore. SEC is a subsidiary of Coal India Ltd.

Read more here.

ADF Foods’ subsidiary gets exclusive distribution rights of Patanjali products

ADF Foods UK, a wholly-owned subsidiary of AD Foods Ltd, has entered into an exclusive distribution agreement with Patanjali Ayurved. The agreement entails the distribution of Patanjali consumer goods in Western Europe and the United Kingdom. This development is in line with ADF Foods’ strategy to widen its product portfolio and offer a complimentary range to retailers, thus leading to better market penetration.

Read more here.

SBI selects Aurionpro to provide solutions for Kanpur Metro Project

State Bank of India (SBI) has selected Aurionpro Solutions Ltd as the solution provider for the Kanpur Metro Project (KMP) to implement an Automatic Fare Collection (AFC) System. The scope of the project includes the implementation of the AFC System followed by maintenance and support for 10 years. The project is valued at ~Rs 140 crore.

Read more here.

SpiceJet to deposit $5 million in 2 weeks or face liquidation: Madras HC

The Madras High Court (HC) has stayed its earlier order of winding up SpiceJet Ltd and appointment of an official liquidator to take over its assets, subject to the condition that the airline deposits $5 million (~Rs 37.70 crore) within two weeks. The airline had failed to make payment of over $24 million to a Swiss-based SR Technics for maintenance, repair, and overhauling of aircraft engines, modules, and components. 

Read more here.

ICICI Bank offers instant overdraft facility to sellers registered on Flipkart

ICICI Bank has partnered with Flipkart to offer an instant and completely digital overdraft (OD) facility of up to Rs 25 lakh to individual sellers and businesses registered on the e-commerce platform. The bank leverages advanced data analytics to develop an industry-first scorecard that helps it evaluate the credit-worthiness of the sellers instantly. Sellers registered on Flipkart can apply for the digital OD facility instantly through Flipkart Seller Hub.

Read more here.

Route Mobile launches instant payment solution

Route Mobile has announced the launch of Click2Pay, an instant payment solution designed to simplify communications commerce and deliver a seamless conversational experience. Click2Pay is a 360-degree communications commerce solution that will include all business communication channels, with a flexible option to integrate payment platforms of choice. The solution is live on the WhatsApp Business Platform.

Read more here.

PNB to raise up to Rs 2,000 crore via AT1 bonds

Punjab National Bank (PNB) plans to raise up to Rs 2,000 crore via Additional Tier I (AT1) bonds. The base size of the offering is Rs 500 crore, with an option to retain oversubscription of Rs 1,500 crore (greenshoe option). There is increasing interest in the instruments of public sector banks as the NPA (bad loan) situation has become better, recoveries have improved and prospects of further stress look less.

Read more here.

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Market News Top 10 News

India’s GDP Grows 1.6% in Q4; Contracts 7.3% in FY21 – Top Indian Market News

India’s GDP grows 1.6% in Q4; contracts 7.3% in FY21

India’s Gross Domestic Product (GDP) for the January-March quarter (Q4 FY21) grew by 1.6%, as per the provisional estimates released by the Ministry of Statistics and Programme Implementation (MoSPI). This indicates that an economic recovery was well underway before the second wave of the Covid-19 pandemic struck the country. The GDP contracted by 7.3% for the entire financial year 2020-21. The Gross Value Added (GVA), which is a more accurate way of assessing the actual economic growth, contracted by 6.2% in FY21.

The agricultural sector grew 3.1%, while the manufacturing sector grew by 6.9% in Q4 FY21. The mining sector contracted by 5.7% during the quarter, and the financial services sector grew 5.4%.

Read more here.

Aurobindo Pharma Q4 Results: Net profit falls 7% YoY to Rs 801 crore

Aurobindo Pharma Ltd reported a 7.2% YoY decline in consolidated net profit to Rs 801 crore for the quarter ended March. Net profit has declined by 72.8% when compared to the previous quarter. Its revenue from operations fell 2.5% YoY to Rs 6,001.5 crore during the same period. For the financial year ended March 31, 2021 (FY21), net profit rose 47% YoY to Rs 5,333.83 crore. 

Read more here.

PNB Housing Finance to raise Rs 4,000 crore from multiple entities

The Board of Directors of PNB Housing Finance has approved fundraising of up to Rs 4,000 crore via the issue of shares and warrants to multiple investors. Pluto Investments, an affiliated entity of private equity fund Carlyle, will invest up to Rs 3,185 crore through a preferential allotment of equity shares and warrants at Rs 390 per share. Existing shareholders of the company and funds managed by Ares SSG and General Atlantic are also participating in the capital raise.

Read more here.

Man Industries Q4 Results: Net profit rises 106% YoY to Rs 25.86 crore

Man Industries (India) Ltd reported a 106.88% YoY increase in consolidated net profit to Rs 25.86 crore for the quarter ended March (Q4). Net profit has declined by 15.4% when compared to the previous quarter. Its revenue from operations declined by 20.76% YoY to Rs 540.09 crore during the same period. For the financial year ended March 31, 2021 (FY21), net profit rose 81.7% YoY to Rs 100.85 crore during the same period. The company’s board has declared a final dividend of Rs 2 per share. Man Industries is a leading manufacturer and exporter of large diameter carbon steel line pipes.

Read more here.

TVS Motors expands in Iraq, launches two new products

TVS Motor Company said it will launch two new products in Iraq as part of its expansion plan in the country. It had opened a new showroom with sales, service, and spares support in Baghdad. The company will launch its commuter motorcycle TVS StaR HLX 140 5 Gear and three-wheeler TVS King Deluxe Plus in Iraq. The new retail outlet has been set up with distribution partner Ritaj International General Trade LLC, which has been distributing TVS Motors’ products since 2017.

Read more here.

Magma Fincorp Q4 Results: Net loss at Rs 626 crore

Magma Fincorp Ltd reported a net loss of Rs 626 crore for the quarter ended March (Q4 FY21). It had posted a net loss of Rs 35 crore in the corresponding quarter last year (Q4 FY20). Revenue from operations declined by 17% YoY to Rs 446 crore in Q4 FY21. The company cleaned its balance sheet by writing off all default account beyond the 90 days past dues in the SME lending business and beyond 180 days past dues in the vehicle finance business.

Magma Fincorp has appointed Adar Poonawalla as its chairman and will soon be rebranded as a Poonawalla Group company.

Read more here.

Intellect Design Arena partners with CWB to enhance payment service technology for business owners

Intellect Design Arena announced that Canadian Western Bank (CWB) has partnered with Intellect Global Transaction Banking (iGTB). The partnership aims to enable more efficient payment capabilities and opportunities to meet the evolving needs of Candian business owners. The solution is architected on a cloud-enabled technology for the high availability and scalability needed for a payments platform. 

Shilpa Medicare Q4 Results: Net profit declines 78% YoY to Rs 7.83 crore

Shilpa Medicare reported a 77.35% YoY decline in consolidated net profit to Rs 7.83 crore for the quarter ended March (Q4). Net profit has increased by 2.10% when compared to the previous quarter. Its revenue from operations declined 5.44% YoY to Rs 208.03 crore during the same period. For the financial year ended March 31, 2021 (FY21), net profit declined by 5.36% YoY to Rs 147.78 crore. The pharma company’s board has declared a dividend of Rs 1.10 per share.

Read more here.

J Kumar Infraprojects secures Rs 1,307.88 crore order from MMRDA

J Kumar Infraprojects Ltd has secured an order worth Rs 1,307.88 crore from the Mumbai Metropolitan Region Development Authority (MMRDA). The order is for part design and construction of balance works of the Mumbai Metro Rail project. J Kumar Infraprojects is engaged in construction activities in India. It executes contracts of various infrastructure projects, including transportation engineering, irrigation projects, civil construction, etc.

Read more here.

Kolte-Patil Developers Q4 Results: Net profit at Rs 21 crore

Kolte-Patil Developers Ltd reported a consolidated net profit of Rs 20.9 crore for the quarter ended March (Q4 FY21). It had reported a net loss of Rs 2.18 crore in the corresponding quarter last year (Q4 FY20). The revenue from operations rose 33.52% YoY to Rs 296.08 crore in Q4 FY21. The company’s sales volumes increased by 27.1% YoY to 0.85 million sq. ft. This has been the best-ever sales quarter in the last six years, both in terms of volume and value.

Read more here.

RBI clarifies on 2018 cryptocurrency circular, asks banks to carry out customer due diligence

The Reserve Bank of India (RBI) has clarified that banks and other regulated entities cannot cite its 2018 circular on cryptocurrencies, as it had been set aside by the Supreme Court in March 2020. The RBI asked banks to continue to carry out the necessary customer due diligence process in line with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT), and obligations of regulated entities under Prevention of Money Laundering Act.

Recently, several large private and public sector lenders had cited the RBI’s 2018 notice to caution customers from dealing in digital currencies and deny services of certain cryptocurrency exchanges.

 

Read more here.

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Editorial

Intellect Design Arena – Company Analysis

Technology has an immense role to play in every field. The use of technology in every field is growing and the financial sector is no different. When you combine finance and technology, you give birth to fintech. Over the years, we have heard that fintech is the future and the financial sector won’t be able to move efficiently ahead without the aid of technology. Today, we discuss one such Indian Fintech company listed in the stock market.

Profile – Intellect Design Arena 

Intellect Design Arena Limited is engaged in providing various financial technology services that help banks to lead businesses on the road to growth and prosperity. They provide their services to banking, insurance and other financial institutes. They are available in various domains which are:

  • Corporate Banking
  • Retail Banking
  • Treasury & Capital Markets
  • Insurance
  • e-Governance Solutions

Whether it’s banks or NBFCs, mutual fund houses or brokerage houses, Intellect Design serves them all. They have more than 240 customers spread across 91 countries. They decrease the complexity of customer data, enable digital transformation and facilitate agility in configuring products so that they can be launched quickly. Over the last five years, revenue has surged at a yearly rate of 16.83% which is way ahead of 9.73% which is the industry average.

Financial Performance

Being a fintech company, you would expect it to perform better every year. Why? Because with each passing year, our use of technology is increasing in every sector of our life. Intellect Design’s revenue has been on a constant rise since 2015. They reported net revenue of Rs 636.28 crore in FY15 and. In less than five years, this revenue became more than its double as revenue worth Rs 1515.24 crore was recorded in FY19. 

For the first time in these many years, their revenue failed to get past the previous years’ mark, In FY20, Intellect declared total revenue of Rs 1,385.10 crore. This can be attributed to the rising case of Covid-19 globally. Even if they failed to beat their previous mark, the fall in the revenue wasn’t steep. This shows the strength of fintech companies. 

The company’s EBITDA (Earnings before interest, tax, depreciation and amortization) surged by more than 10X times from FY17 to FY19. The EBITDA value for FY20 fell to 113.68 crore from Rs 197.79 crore in the previous year. This was because of the steep increase in their operation cost last year. The company also incurred high charges of depreciation and amortization. 

Even after such good performance in pre-Covid times, Intellect Design failed to increase its market share substantially. Yes, their market share has increased from 3.44% to just 4.66% in the last half-decade. This shows that the company has failed to present itself as a powerful player. At the same time, we cannot just solely attribute it to the company. Fintech is a sector that has a lot of competition. Due to high and fierce competition, one would expect the company to grow slowly but be always on the right track.

Stock Performance

Weekly Chart of Intellect Design

Before the Covid pandemic, the stock used to take a massive resistance around Rs 300. A not-so-great financial performance in FY20 was received negatively by the investors and the stock fell. In March 2020, just like many other stocks, Intellect Design also touched its all-time low of Rs 43.80. On 1st April 2021, it touched its all-time high of Rs 773.80. That means in just over a year time frame, it has given whopping returns of more than 1500%! How great is that?!

There will be very few retail shareholders who have collected this stock at the low and still holding it, but if any of you have generated some profits in this stock, do let us know in the comments section. The chart displayed above also shows how tremendous gains this stock has given since the turn of the new year. Not only the share prices have risen massively but also with great volumes. The confidence of foreign institutions has also grown in this stock. They had a stake of 20.82% in December 2019 but it increased steadily to 24.11% by December 2020.

Conclusion

One of the reasons why Intellect is different from other fintech companies is due to its adoption of the “design thinking” approach. Design Thinking helps them by forcing a new and unique way of thinking. As their brainstorm methods are different to others, they engineer solutions that drive unprecedented value for their customers. Their office theme is very different to any other office. The way they set their meeting, their discussions are way different and unique. Their distinctive workplace pushes them to create solutions that can give rise to a joyous collaborative experience.

The financial sector of every country in the world has to be supported by technology. Fintech is already a huge part of today’s world and its influence will only grow in the future. Thus, the business prospects of the company look robust. Can they continue their excellent performance? The results of the fourth quarter and hence, the whole year will be out soon as well. Will their numbers improve when compared to the last year? Or the pandemic will take a toll on their balance sheet as well? We will find answers to these questions very soon. What is your opinion on this company? Do tell us via the comments section on the marketfeed application!