Zensar Technologies : Net Profit Up By 9% In March'14 Quarter

Zensar Technologies (ZTL), a Pune-based IT service provider company, posted its financial performance for the quarter and year ended 31 March, 2014 yesterday (April 23, 2014). The company posted a good set of numbers on both sequential and year on year basis.

For the March quarter, ZTL reported a bottomline growth of 9% to reach Rs 55.3 crore. The net sales of the company showed a growth of 2% to reach Rs 602.5 crore during the quarter. The growth in net sales is mainly led by application management services business, which contributes about 68% to the net sales. However, its product & services business sales declined by 14% to Rs 60 crore in the said quarter.

Further, on the margins front, EBITDA margin for Q4FY14 expanded by 79 basis points to 15.48%. The net profit margin  also expanded by 56 basis points to 9.09% on quarter on quarter basis.

Moreover, for the financial year 2013-14, the company registered a growth of 10% in revenue to reach Rs 2335 crore. Net profit jumped by 36% to Rs 237.5 crore. The EBITDA and net margin expanded by 110 basis points to 15.34% and 197 basis points to 8.2% respectively.

Going forward, the company gave a positive guidance for FY15, shifting its main focus to the services segment. The management intends to expand its cloud services in its various business segments. It has a target to expand the infrastructure management services segment at 25% of the total revenue. In addition, it expects the US, Europe, Africa markets to show good growth in the coming year. The company has deals worth USD 270-275 million in the pipeline. Along with this, ZTL is looking forward to expand its digital transmission business to 5% of its revenue for FY15.

Currently, ZTL's stock price is trading at a 5% high from the previous closing of Rs 371.