Nucleus Software Q2 Review - Supply Side Issues Continues To Stress Operating Profit Margin: Dolat Capital
BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Dolat Capital Report
Nucleus Software Exports Ltd. reported 5.2% QoQ revenue growth (our estimate: 5.6%) due to softness in order-to-revenue conversion due to lingering impact of supply side challenges (headcount slides nearly 20% YoY).
Nucleus Software reported Ebit margin of 1.4% versus estimate of 2.7% and Ebit of Rs 17 million.
The Ebit margin remains subdued due to the impact of steep wage hikes to control attrition in Q1 and modest revenue growth negating any potential operating leverage.
Order book stood at Rs 5.4 billion up 2.2% QoQ (up 13.3% YoY basis). The net new orders stood at Rs 1.26 billion which is higher than revenue during the quarter (largely implying order conversion delay).
We believe the revenue recovery will be slower than what we expected given continued impact of supply side challenges.
Click on the attachment to read the full report:
This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BloombergQuint.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.