CE Info Systems Ltd: A Market Leader with 42% CAGR in Net Profit – A Stock to Watch
ICE Info Systems : ndia’s software product industry is on an upward trajectory, projected to reach $30 billion in annual revenue by 2025. With overall IT spending in the country expected to grow by 11.2% to nearly $160 billion in 2025, the IT landscape is ripe with opportunities. Among the players riding this growth wave is C.E. Info Systems Ltd, a leader in the mapping systems domain. This company has shown an impressive net profit CAGR of 42% over five years, making it a compelling stock to keep an eye on.
Price Movement and Market Position
With a market capitalization of ₹8,990.20 crore, C.E. Info Systems Ltd, also known as MapmyIndia, dominates the in-dash navigation market with an 80% market share. This leadership position underscores its competitive edge and widespread adoption in the automotive navigation industry.
On the stock market front, the company’s shares closed at ₹1,652.00, experiencing a slight dip of 0.14% from the previous closing of ₹1,654.35. Despite this minor fluctuation, the company’s fundamentals remain robust, reflected in its debt-to-equity ratio of 0.05, indicating minimal financial obligations.
Stellar Financial Performance
C.E. Info Systems Ltd has demonstrated remarkable growth and profitability. The company’s net profit rose from ₹23 crore in FY19-20 to ₹134 crore in FY23-24, showcasing a CAGR of 42%. This growth reflects its expanding market presence and strong financial health.
In Q3 FY25, the company reported a revenue of ₹115 crore, marking a 25% YoY increase. For the nine-month period, revenue surged by 17% to ₹320 crore. The EBITDA for Q3 FY25 stood at ₹42 crore, maintaining a 36% margin, while the nine-month PAT rose to ₹99 crore from ₹96 crore in FY24.
Segment-wise Performance
C.E. Info Systems Ltd has shown robust growth across its business segments:
- Consumer Tech & Enterprise: Revenue surged by 39% YoY to ₹65 crore.
- Automotive & Mobility Tech: Grew by 9% to ₹49 crore.
- Map-led Business: Increased by 33% to ₹287 crore.
- IoT-led Business: Achieved a modest growth of 4% YoY.
Strategic Developments and Global Expansion
The company is not just resting on its laurels; it’s expanding its footprint globally. C.E. Info Systems Ltd recently launched a joint venture with Hyundai Autoever in Indonesia, signaling its ambitions in the international market.
Furthermore, the company has enhanced its Mappls App strategy and secured a significant contract with a global social media network in India. It has also accelerated customer acquisition across automotive, fleet management, tech startups, and government sectors, strengthening its market position.
Challenges and Future Outlook
Despite its impressive performance, the company faced a one-time project impact on the Consumer Tech & Enterprise segment and higher outsourcing costs. Nevertheless, management remains optimistic about achieving its 25% annual growth target. They anticipate that temporary outsourcing costs for government projects will align with revenue in the coming quarters, boosting Q4 earnings.
Management’s Vision and Strategic Focus
The management is confident of reaching its ₹1,000 crore revenue target by FY28, driven by strong execution and a highly skilled team. Their strategy focuses on revenue growth and EBITDA, rather than merely maximizing margin percentages. This approach reflects a long-term vision for sustainable business expansion.
The company is also actively exploring government projects, which were previously avoided due to payment concerns. Although these projects yield lower margins than corporate and automotive sectors, they are expected to contribute up to 20% of the company’s revenue by year-end. This strategic shift could impact overall margins but is likely to enhance long-term growth and stability.
Financial Ratios and Key Metrics
The financial health of C.E. Info Systems Ltd is reflected in its robust ratios and key performance metrics:
| Metric | Value |
|---|---|
| Market Cap | ₹ 8,985 Cr. |
| Current Price | ₹ 1,651 |
| High / Low | ₹ 2,748 / 1,513 |
| Stock P/E | 65.9 |
| Book Value | ₹ 134 |
| Dividend Yield | 0.21% |
| ROCE | 26.2% |
| ROE | 20.6% |
| Debt to Equity | 0.05 |
| Debt | ₹ 34.8 Cr. |
| PEG Ratio | 1.50 |
| Intrinsic Value | ₹ 632 |
| Graham Number | ₹ 275 |
| Piotroski Score | 6.00 |
| Price to Book Value | 12.4 |
| ROIC | 54.5% |
Why Investors Should Keep an Eye on C.E. Info Systems Ltd
With its impressive net profit CAGR of 42% over five years, robust market position, strategic global expansions, and a clear growth vision, C.E. Info Systems Ltd is undoubtedly a stock to watch. Its minimal debt, high ROCE and ROIC, and strategic focus on sustainable growth further solidify its investment appeal.
Conclusion
As India’s IT landscape continues to expand, C.E. Info Systems Ltd is well-positioned to capitalize on this growth wave. Its leadership in digital mapping, strategic global ventures, and diversified revenue streams make it a formidable player in the tech industry.
For investors looking to capitalize on India’s digital transformation, C.E. Info Systems Ltd is a stock worth considering. With its solid financial performance, strategic vision, and competitive edge, it could be a valuable addition to a growth-oriented portfolio.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.