SSI recorded a 13.7% rise in sales and 8.8% drop in net profit on a QoQ basis. The decline in bottomline is due to a write off of Rs 27.8 m towards dimmunition in value of investments in its subsidiaries. Excluding which, the net profit figure would have actually risen by a marginal 1.3%.
Operating Profit (EBDIT)
Operating Profit Margin (%)
Profit before Tax
Provision for contingencies
Profit after Tax/(Loss)
Net profit margin (%)
No. of Shares (eoy) (m)
Diluted number of shares
Diluted Earnings per share*
P/E (at current price)
It's operating margin has gone up by 200 basis points. The break up of expenditure included 25% towards staff costs, 31% towards course execution charges, 5% towards software purchase and 9.8% towards other expenses.
On a YoY basis, the net profit has gone up by 187% and the revenues have gone up by 190% in 2QFY01. However, the operating margin has significantly come down to 27.3% from around 33.9% in 2QFY00. This is due to the fact that its employee costs have gone up by 668% YoY during the quarter.
The improvement in operating margins (compared to 1QFY01) is due to the fact that contribution of revenues from software development increased to 40% compared to 34% in 1QFY01. The contribution of revenues from education declined to 55% compared to 58% in 1QFY01. The remaining 5% came from global support services.
At a current stock price of Rs 1,454 the stock is trading at a P/E multiple of 19 times its 2QFY01 annualised earnings.
LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India. Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: firstname.lastname@example.org. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407