The shares of this information technologies company rose 3 percent after it received a contract for end user support service from a small finance bank.
At 9:30 a.m the shares of 3I Infotech were trading green at a share price of Rs 42.30 up by 3 percent from its previous day close and the market capitalisation of the company is 700 Cr.
As per the company’s filing on BSE, it has received a contract of Rs. 39.55 Cr plus one time transition charges of Rs. 35 lakhs for a period of 5 years starting from October 1, 2023 to September 30, 2028 ,with the option to extend the contract with mutual agreement, for providing end support services to Ujjivan Small Finance Bank.
3I Infotech revenue has increased by 7.7 percent from 677.01 Cr in FY22 to 729.11 Cr in FY23 accompanied by loss which has decreased from 57.49 Cr to a profit of 1.37 Cr.
The company has reported a return on equity (ROE) of 0.21 percent and return on capital employed (ROCE) of 1.9 percent, both the profitability ratios are low as the company is not able to maintain good net profit margins.
In the recent financial year the company margins turned to positive which includes Gross profit margin of 5.68 percent and the same goes for operating margin of 2.56 percent. From the last five fiscal years the company has consistently reduced its debt to equity ratio to 0.06 in 2023 from 2.79 in 2019.
3I Infotech provides software IT services and business process outsourcing for a variety of industries including insurance, banking, capital markets, mutual funds and asset management, wealth management, government, manufacturing and retail.
Note: Due to the illiquidity in penny stocks, the stock can hit its assigned circuit levels with just a minor increase in volume of trades. Even if the stock prices are within the usual buying range for the investors and offer enormous potential profits, penny stocks are quite dangerous for retail investors.
Written by: Bharath K.S
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