Kelton Tech Solutions Ltd. - Research Report

Kelton Tech Solutions Ltd. formerly known as VFM Soft Tech Ltd is an B /T+1 group, Software & Consulting company with having Face value of Rs. 5. Kelton Tech Solutions Ltd offers services in digital transformation, ERP and other IT services. It has operations across US, Europe, India and Asia-Pacific with a team of ~1,500 employees. Its services include agile software development, digital commerce & marketing, digital integration, outsourced product development, platform modernization, professional services, technology consulting, testing & automation and others. It has more than 300 clients and its top client is United Parcel Service Inc. which accounted for ~5% revenues in FY20. It has been associated with key-startups such as Flipkart, Snapdeal, Jabong, Yebhi, PayTM, MakeMyTrip, PolicyBazaar, etc.

Fundamentals (FY22-23):

CMP	48
52 - week high	106
52 – week low	47
Dividend % (consolidated)	0.0
ROCE	16.80%
BVPS	15.26
Revenue	Rs. 230.87 cr.
Debt to Equity	0.22
P/E ratio	6.89
EPS (consolidated)	7.30
P/B ratio	3.18
Market Cap	Rs. 476.50 Cr.
Face value	Rs. 5

 

 

Financial Results:

Company’s Net Sales was at Rs 230.87 crore in December 2022 up 5.3%, Quarterly Net Profit at Rs. 16.56 crore in December 2022 down 6.95% and EBITDA stands at Rs. 26.00 crore in December 2022 down 1.59% as compared to December 2021.

List of recent updates regarding the company:

1. Kode and Kellton partnered to offer an integrated offering to help start-ups in the Dutch and European markets ramp up their software development capabilities, rationalize costs, and achieve new economies of scale.
2. Kellton will provide HMWSSB, the Government of Telangana, with IoT-based enterprise intelligence and analytics solutions to drive actionable insights in real-time and transform citizen service experiences as well as the Metro Customer Care as more efficient, agile, and future-ready.
3. Kellton has also bagged a contract to build a cutting-edge NFT (Non-Fungible Tokens) marketplace, using new digital technologies, including blockchain. The advanced NFT marketplace will create exceptional user experiences while buying, selling, and auctioning digital artifacts in the form of tokens.
4. The company has launched KeLive — a one-stop, cloud-based, and intelligent building management system. KeLive is engineered to help real estate agencies and property management companies automate rule-based tasks and manage administrative operations anywhere, anytime, and across devices.
5. The company recently launched tHRive+, a new, cloud-native proprietary product with embedded analytics to meet the rapidly growing demand for smart, connected HRM experiences.
6. Company has been chosen by ZEE5, India’s Entertainment Super-app, to build a next-generation, cloud-native content management system (CMS) that delivers relevant, real-time content experiences across all constituents of business.
7. Kelton Tech collaborated with Automation Anywhere, a leading RPA and intelligent automation platform. Through this partnership, Kellton will expand its RPA and Intelligent Automation capabilities in North America, APAC, and Europe, driven by an agile, future-led digital ecosystem.
8. Company has been awarded a contract to implement the SAP S/4HANA solution by Momentive Quartz Technologies (MQT), a leading chemical manufacturing company.
9. The company recently announced the expansion of its partnership with Google Cloud Apigee platform which helps organizations use APIs to harness the full potential of data and enable connected digital experiences on an enterprise-scale that includes customers, partners, and employees.
10. It has also collaborated with Workato, a provider of Enterprise iPaaS, Workflow Automation, Conversational Bots, API, and Cloud Integration solutions to help drive greater integration and automation capabilities for its customers and partners.

In last 3 years the stock gave a return of 561.53% as compared to Sensex which gave a return of 115.67% and 579.86% return compared to 117.21% rise in Nifty.

Over the last 5 years, the company has made various debt-funded acquisition of various startups/ companies. The NFT marketplaces are rapidly gaining traction, reaching over $2 Billion in transaction volume in the last quarter and it might generate good returns for the company in future. The new technologies and solutions in various field launched by the company and has been reflecting well in its balance sheet and will continue to grow in future considering the adaption of technology in various sectors. Company’s balance sheet is also backed by long term partnerships with well-known start-ups such as Flipkart, Snapdeal, Jabong, Yebhi.com, PayTM, MakeMyTrip, PolicyBazaar etc. so investors looking for safe investments and healthy returns can add this company’s stock into their portfolios for long term period.

- Het Zaveri

- info@smartinvestment.in

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