Shares of this smallcap company surged 5 percent after receiving an order worth Rs. 119 crores from one of the leading public sector banks. The shares have delivered a multi-bagger return of 158 percent to its shareholders in one year.
Price Movemnet:
With a market capitalization of Rs. 1,593 crores, the shares of Dynacons Systems & Solutions Ltd started Wednesday’s trading session on a higher note at Rs. 1,280 compared to its previous close of Rs. 1,197.60. During the trading session, the shares hit a high of Rs. 1,285.95, gaining around 5 percent and are currently trading at Rs. 1,256 apiece.
What Happened:
Such a positive movement in the share price was observed after the company in an exchange filing announced that it had been awarded a prestigious project worth Rs. 119 Crores by the Central Bank of India. This project involves supplying, implementing, and maintaining private cloud infrastructure, backup solutions, and supporting applications at the bank’s Data Center (DC) and Disaster Recovery Center (DRC).
The project involves implementing a Private Cloud solution for CBS data, VMs, containers, backup hardware, and object-based storage. It includes Tape Library Integration, Batch Job Automation, Domain User Administration, Internal Cloud Infrastructure, VDI, and Access Management.
Additionally, it encompasses Professional Services and Facility Management for the Data Centers (DC) and Disaster Recovery Centers (DRC), spanning 5 years initially with an option for a 2-year extension.
Financial:
Looking at the company’s financial statements, the revenue increased by 24 percent from Rs. 227 crores during the December quarter to Rs. 282 crores in the March quarter. In addition, the net profits jumped by 8 percent from Rs. 13 crores to Rs. 14 crores during the same period.
Recent Developments:
Earlier, the company secured a significant contract worth Rs. 233 crores (all inclusive) from the National Bank for Agriculture and Rural Development (NABARD).
The order was received for the upgrade and migration of Core Banking Solution (CBS) from Finacle 7.0 to Finacle 10.2.25, operating on the Application Service Provider (ASP) model and the scope of the contract includes serving 1,391 branches of 38 State Coop Banks across 8 states.
Customer Base:
The company caters to a wide variety of clients ranging from Government to PSU companies such as LIC, NPCI, etc and also provides services for banking companies like Bank of India, Axis Finance, etc. Further, it has also extended its services to global companies such as H&M, McAfee, etc.
Important Financial Ratios:
In terms of key financial metrics, the company reported a Return on Equity (RoE) of 34.14 percent and a return on capital employed (RoCE) of 46.83 percent for the period spanning FY23-24. Further, the net profit margin during FY23-24 was 5.25 percent.
Company Profile:
Headquartered in Mumbai, Dynacons Systems and Solutions was incorporated in 1995. The company provides IT infrastructure and operates in a single segment of system integration and services.
Written By Vaibhav Patil
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