BSE:540900

Stock Analysis Report

Newgen Software Technologies

Executive Summary

Newgen Software Technologies Limited provides software products and solutions in India, Europe, the Middle East, Africa, the Asia Pacific, and the United States.


Snowflake Analysis

Flawless balance sheet with high growth potential.

Share Price & News

How has Newgen Software Technologies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 540900's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

7.1%

540900

-3.8%

IN Software

-3.0%

IN Market


1 Year Return

-65.6%

540900

-51.4%

IN Software

-29.2%

IN Market

Return vs Industry: 540900 underperformed the Indian Software industry which returned -52.4% over the past year.

Return vs Market: 540900 underperformed the Indian Market which returned -29% over the past year.


Shareholder returns

540900IndustryMarket
7 Day7.1%-3.8%-3.0%
30 Day-43.0%-38.6%-26.9%
90 Day-42.7%-38.1%-28.5%
1 Year-65.3%-65.6%-50.5%-51.4%-27.7%-29.2%
3 Yearn/a-48.7%-53.2%-15.2%-19.9%
5 Yearn/a-39.4%-48.3%-3.1%-8.1%

Price Volatility Vs. Market

How volatile is Newgen Software Technologies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Newgen Software Technologies undervalued compared to its fair value and its price relative to the market?

19.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 540900 (₹113) is trading below our estimate of fair value (₹140.02)

Significantly Below Fair Value: 540900 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 540900 is poor value based on its PE Ratio (8.3x) compared to the Software industry average (7x).

PE vs Market: 540900 is good value based on its PE Ratio (8.3x) compared to the Indian market (9.2x).


Price to Earnings Growth Ratio

PEG Ratio: 540900 is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: 540900 is overvalued based on its PB Ratio (1.6x) compared to the IN Software industry average (0.6x).


Next Steps

Future Growth

How is Newgen Software Technologies forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

21.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 540900's forecast earnings growth (21.5% per year) is above the savings rate (6.5%).

Earnings vs Market: 540900's earnings (21.5% per year) are forecast to grow faster than the Indian market (19.8% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 540900's revenue (15.4% per year) is forecast to grow faster than the Indian market (9.1% per year).

High Growth Revenue: 540900's revenue (15.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 540900's Return on Equity is forecast to be high in 3 years time (21.1%)


Next Steps

Past Performance

How has Newgen Software Technologies performed over the past 5 years?

20.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 540900 has high quality earnings.

Growing Profit Margin: 540900's current net profit margins (13.9%) are lower than last year (16.5%).


Past Earnings Growth Analysis

Earnings Trend: 540900's earnings have grown by 20% per year over the past 5 years.

Accelerating Growth: 540900's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 540900 had negative earnings growth (-5.4%) over the past year, making it difficult to compare to the Software industry average (-4%).


Return on Equity

High ROE: 540900's Return on Equity (19.5%) is considered low.


Next Steps

Financial Health

How is Newgen Software Technologies's financial position?


Financial Position Analysis

Short Term Liabilities: 540900's short term assets (₹4.8B) exceed its short term liabilities (₹2.0B).

Long Term Liabilities: 540900's short term assets (₹4.8B) exceed its long term liabilities (₹553.7M).


Debt to Equity History and Analysis

Debt Level: 540900's debt to equity ratio (13%) is considered satisfactory.

Reducing Debt: 540900's debt to equity ratio has reduced from 21.4% to 13% over the past 5 years.

Debt Coverage: 540900's debt is well covered by operating cash flow (218.7%).

Interest Coverage: 540900 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 540900 has a high level of physical assets or inventory.

Debt Coverage by Assets: 540900's debt is covered by short term assets (assets are 7.7x debt).


Next Steps

Dividend

What is Newgen Software Technologies's current dividend yield, its reliability and sustainability?

2.65%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 540900's dividend (2.65%) is higher than the bottom 25% of dividend payers in the Indian market (0.95%).

High Dividend: 540900's dividend (2.65%) is low compared to the top 25% of dividend payers in the Indian market (4.18%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 540900 has been paying a dividend for less than 10 years.

Growing Dividend: 540900's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (22%), 540900's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 540900's dividends in 3 years are forecast to be well covered by earnings (20.4% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.5yrs

Average management tenure


CEO

Diwakar Nigam (65yo)

4.5s

Tenure

₹17,490,000

Compensation

Mr. Diwakar Nigam co-founded Newgen Software Technologies Limited in 1992 and serves as its Managing Director and served as its Chief Executive Officer until October 05, 2017. Mr. Nigam has been an active  ...


CEO Compensation Analysis

Compensation vs Market: Diwakar's total compensation ($USD233.94K) is above average for companies of similar size in the Indian market ($USD48.08K).

Compensation vs Earnings: Diwakar's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Diwakar Nigam
Co-Founder4.5yrs₹17.49m26.98% 2.1b
T. Varadarajan
Co-Founder & Whole-Time Director27.75yrs₹8.37m21.92% 1.7b
Arun Gupta
Chief Financial Officer2.42yrsno data0.080% 6.2m
Aman Mourya
Company Secretary & Compliance Officerno datano datano data
Virender Jeet
Senior Vice-President of Sales & Marketing / Products2.42yrsno datano data
Surender Raj
Senior Vice President of Human Resources Operations13.92yrsno data0.36% 28.2m
Priyadarshini Nigam
Whole-Time Director22.5yrs₹4.08m11.64% 900.5m
Tarun Nandwani
Senior Vice President of Business Management of Existing Customers & Commercials0.83yrno datano data
R. Kumar
Vice Presidentno datano datano data
Dushyant Kumar
Vice President of Software Developmentno datano data0.16% 12.3m

3.5yrs

Average Tenure

59yo

Average Age

Experienced Management: 540900's management team is considered experienced (3.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Diwakar Nigam
Co-Founder4.5yrs₹17.49m26.98% 2.1b
T. Varadarajan
Co-Founder & Whole-Time Director27.75yrs₹8.37m21.92% 1.7b
Priyadarshini Nigam
Whole-Time Director22.5yrs₹4.08m11.64% 900.5m
Saurabh Srivastava
Non-Executive Independent Director2.58yrs₹1.30mno data
Kaushik Dutta
Non-Executive Independent Director5.67yrs₹1.40mno data
Subramaniam Iyer
Non-Executive Independent Director2.33yrs₹1.40mno data

4.2yrs

Average Tenure

63.5yo

Average Age

Experienced Board: 540900's board of directors are considered experienced (4.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 540900 insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Newgen Software Technologies Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Newgen Software Technologies Limited
  • Ticker: 540900
  • Exchange: BSE
  • Founded: 1992
  • Industry: Systems Software
  • Sector: Software
  • Market Cap: ₹7.736b
  • Shares outstanding: 68.46m
  • Website: https://www.newgensoft.com

Number of Employees


Location

  • Newgen Software Technologies Limited
  • A-6, Satsang Vihar Marg
  • Qutab Institutional Area
  • New Delhi
  • Delhi
  • 110 067
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NEWGENNSEI (National Stock Exchange of India)YesEquity SharesININRJan 2018
540900BSE (Mumbai Stock Exchange)YesEquity SharesININRJan 2018

Biography

Newgen Software Technologies Limited provides software products and solutions in India, Europe, the Middle East, Africa, the Asia Pacific, and the United States. It offers enterprise content management suite, which enables end-to-end management of enterprise content, from capture to disposition; business process management suite that provides a platform for business stakeholders to drive enterprise-wide digital transformation; customer communication management suite, a communication platform that enables to share of customers’ wallet by tapping various cross-sell/ up-sell opportunities across touch points, such as email, SMS, Web, and print; document management system; and workflow and process automation software. It serves banks, insurance firms, BPO’s, healthcare organizations, government, telecom companies, and shared service centers. The company was founded in 1992 and is based in New Delhi, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/27 13:49
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.