Infibeam surged above 8% on outstanding Q2

Infibeam Incorporation rolled above 8 percent to Rs 1,078 on 18th Nov’s intra-day trade, its highest level since listing in April this year. Infibeam share price settled above 6 per cent at Rs. 1060.30.

Analysts believe that the Value Added Services (VAS) which includes logistics, payment solutions, warehousing facilities, digital catalogue, cloud services and analytics services provided by the company, dictate the premium over its peers in the E-commerce space.

With the Government’s Digital India and Smart Cities project, it is expected that the internet access, internet users and smart-phone penetration will increase at tremendous pace, thus breaking all sorts of technological barriers in Tier II & Tier III cities and Rural India. With the growing access to the internet, it is also anticipated that the E-commerce market will increase drastically, thereby expanding the market pie and incumbents’ shares.

Infibeam is the e-commerce company focused on developing successful e-commerce platforms and ecosystems.

Q2 Glimpses

• Infibeam has registered a whooping jump of 316 per cent in profit before tax at Rs 13.6 crore for the 2nd quarter ended September 2016 as compared to Rs 3.3 crore in the corresponding quarter last year.
• The firm’s total revenues increased 32 per cent to Rs. 114.7 crore for the quarter under review as compared to Rs. 87 crore in the corresponding period last year.
• In the two main business segments, service revenues amounted to Rs. 33.6 crore against Rs. 26 crore, while product revenues grew 33 per cent to Rs. 81 crore from Rs. 61 crore last year.
• For the first half period, the company clocked a profit before tax of Rs. 25.3 crore, 318 per cent up from Rs. 6.1 crore in the same period last year.
• Total revenues for the half-year period is recorded at Rs. 217.5 crore versus Rs. 171 crore in the same period last year.
• Vishal Mehta, Managing Director, commented on the financial results stating that the company’s growth is led by its strategy to innovate revenue streams from service and product segments.
• During the first half of 2016-2017, the company has signed and initiated the completion of different important projects with leading consumer brands, infrastructure Development Company, payment solution companies, telecoms both for domestic and international market. This will enhance the business expansion plans within the product and services business segments.

A Glance on the IT Sector

India’s IT services sector is anticipated to show a slow growth this financial year since local and global factors weigh on the outsourcing industry.

Revenue from the sector can grow 8 to 10 per cent in constant currency terms in the 2016-17 financial year, lower than an earlier forecast of 10 to 12 per cent, the National Association of Software and Services Companies (NASSCOM) mentioned.

Events including the U.S. presidential election and Britain’s vote to exit the European Union have weighed on the Indian IT outsourcing sector with most of its revenues coming from North America and Europe.