- 06 May 2022
- ICICIdirect Research
INTELLECT DESIGN ARENA GUIDES 20% REVENUE GROWTH IN FY23
INTELLECT - 793 Change: 2.75 (0.35 %)News: Intellect reported muted numbers on Q4, both in terms of revenues and margins due to loss of couple of deals because of geopolitical issues ( US$4-5mn loss). Dollar revenues came in at US$68( flat QoQ) while rupee revenues came in at Rs509 crore (+0.2% QoQ). SAAS revenue however continue to report strong numbers as it grew 34% QoQ and 85% YoY to Rs119 crore. EBITDA margins were down 250bps QoQ to to 23.7% due to weak topline. For FY22, the company reported 25% revenue growth to Rs1878 crore ( vs guided 20%+ growth), while SAAS revenues grew by 108% in FY22 and now forms 20% of the revenue mix. License linked revenues ( License + SAAS+ AMC) forms 57% of the mix in FY22 vs 54% in FY21 and 46% in FY20. EBITDA margins for FY22 came in at 25% ( it could have been ~27%, if there was no loss of those deals), which were lower than guided number.
Views: The company’s revenue performance has exceeded guidance however they were short on margin side in FY22. The company’s funnel continue to grow and it stands at US$ 725 mn for Q4 which is up by 7.4% QoQ/ 24% YoY which provides better visibility for future revenues. The company continue to win large deals ( 61 vs 43 in Q4FY21) where the winning rate is ~70%. The company continue to maintain that they would be reaching US$75mn quarterly run rate in 2 quarters from now and now are aiming to reach US$100 mn quarterly revenue run rate in 2 years. The company has refrained from providing margin guidance for FY23 citing expansion in 3 countries and also continued investments in manpower and S&M costs. The company mentioned that their attrition in the top 500 people which is a critical talent pool is <10%.
Impact: Positive