NSEI:INTELLECT

Stock Analysis Report

Intellect Design Arena

Executive Summary

Intellect Design Arena Limited provides software development and related services for banking, insurance, and other financial services in India and internationally.

Rewards

Revenue is forecast to grow 13.19% per year

Risk Analysis

Highly volatile share price over past 3 months

Large one-off items impacting financial results

Profit margins (1.3%) are lower than last year (8.4%)

Shareholders have been diluted in the past year



Snowflake Analysis

Mediocre balance sheet with concerning outlook.


Similar Companies

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Share Price & News

How has Intellect Design Arena's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-15.1%

INTELLECT

-4.3%

IN Software

-0.8%

IN Market


1 Year Return

-10.0%

INTELLECT

-15.9%

IN Software

11.1%

IN Market

Return vs Industry: INTELLECT exceeded the Indian Software industry which returned -16.2% over the past year.

Return vs Market: INTELLECT underperformed the Indian Market which returned 11.1% over the past year.


Shareholder returns

INTELLECTIndustryMarket
7 Day-15.1%-4.3%-0.8%
30 Day-14.8%-3.2%-2.3%
90 Day-7.9%-0.5%2.1%
1 Year-10.0%-10.0%-15.1%-15.9%13.1%11.1%
3 Year29.1%21.0%-14.5%-21.4%22.9%16.2%
5 Year29.0%20.8%-0.4%-14.5%34.9%22.6%

Price Volatility Vs. Market

How volatile is Intellect Design Arena's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Intellect Design Arena undervalued compared to its fair value and its price relative to the market?

104.6x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: INTELLECT (₹136.6) is trading above our estimate of fair value (₹30.39)

Significantly Below Fair Value: INTELLECT is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: INTELLECT is poor value based on its PE Ratio (104.6x) compared to the Software industry average (12.2x).

PE vs Market: INTELLECT is poor value based on its PE Ratio (104.6x) compared to the Indian market (13.4x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate INTELLECT's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: INTELLECT is overvalued based on its PB Ratio (1.8x) compared to the IN Software industry average (1x).


Next Steps

Future Growth

How is Intellect Design Arena forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

13.2%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if INTELLECT's forecast earnings growth is above the savings rate (6.5%).

Earnings vs Market: Insufficient data to determine if INTELLECT's earnings are forecast to grow faster than the Indian market

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

Revenue vs Market: INTELLECT's revenue (13.2% per year) is forecast to grow faster than the Indian market (9% per year).

High Growth Revenue: INTELLECT's revenue (13.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: INTELLECT's Return on Equity is forecast to be low in 3 years time (13.5%).


Next Steps

Past Performance

How has Intellect Design Arena performed over the past 5 years?

70.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: INTELLECT has a large one-off gain of ₹549.5M impacting its December 31 2019 financial results.

Growing Profit Margin: INTELLECT's current net profit margins (1.3%) are lower than last year (8.4%).


Past Earnings Growth Analysis

Earnings Trend: INTELLECT's earnings have grown significantly by 70.6% per year over the past 5 years.

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

Earnings vs Industry: INTELLECT had negative earnings growth (-84.3%) over the past year, making it difficult to compare to the Software industry average (-4.6%).


Return on Equity

High ROE: INTELLECT's Return on Equity (1.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Intellect Design Arena's financial position?


Financial Position Analysis

Short Term Liabilities: INTELLECT's short term assets (₹8.7B) exceed its short term liabilities (₹6.2B).

Long Term Liabilities: INTELLECT's short term assets (₹8.7B) exceed its long term liabilities (₹861.3M).


Debt to Equity History and Analysis

Debt Level: INTELLECT's debt to equity ratio (19.3%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if INTELLECT's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: INTELLECT's debt is not well covered by operating cash flow (9.7%).

Interest Coverage: INTELLECT's interest payments on its debt are not well covered by EBIT (0.6x coverage).


Balance Sheet

Inventory Level: INTELLECT has a low level of unsold assets or inventory.

Debt Coverage by Assets: INTELLECT's debt is covered by short term assets (assets are 4.4x debt).


Next Steps

Dividend

What is Intellect Design Arena's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%0.6%markettop25%2.5%industryaverage2.0%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate INTELLECT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate INTELLECT's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if INTELLECT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if INTELLECT's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of INTELLECT's dividend in 3 years as they are not forecast to pay a notable one for the Indian market.


Next Steps

Management

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

4.3yrs

Average management tenure


CEO

Arun Jain (60yo)

5.5yrs

Tenure

0

Mr. Arun Jain, B.E., founded Polaris Consulting & Services Limited (also known as Polaris Financial Technology Limited and Polaris Software Lab Ltd.) in 1993. Mr. Jain serves as Chief Executive Officer of  ...


Leadership Team

NamePositionTenureCompensationOwnership
Arun Jain
Chairman & MD5.5yrsno data7.44% 1.4b
Venkateswarlu Saranu
Chief Financial Officer1.6yrs₹10.30mno data
V. Naresh
VP, Compliance Officer & Company Secretary5.3yrs₹3.60m0.0068% 1.3m
Anil Verma
Whole Time Director5.4yrs₹26.64m0.081% 15.5m
Andrew England
Head of Strategy - Intellect Global Transaction Banking & Director1.3yrs₹17.26mno data
Ganesh Balaji
Chief Technology Officer0yrsno datano data
K. Govindarajan
Global Head of Administration0yrsno datano data
Praveen Malik
Vice President of Investor Relations0yrsno datano data
A. Ravi Shankar
SVP of Legal & General Counsel0yrsno datano data
Jean-Pierre Arens
Head of Business Development0yrsno datano data

4.3yrs

Average Tenure

61yo

Average Age

Experienced Management: INTELLECT's management team is considered experienced (4.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Arun Jain
Chairman & MD5.5yrsno data7.44% 1.4b
Anil Verma
Whole Time Director5.4yrs₹26.64m0.081% 15.5m
Andrew England
Head of Strategy - Intellect Global Transaction Banking & Director1.3yrs₹17.26mno data
Aruna Rao
Independent Director5.3yrsno data0.0052% 989.2k
Vijaya R. Sampath
Independent Director1.3yrs₹250.00kno data
Arun Aran
Independent Director3.6yrs₹1.50m0.44% 83.9m

4.5yrs

Average Tenure

61yo

Average Age

Experienced Board: INTELLECT's board of directors are considered experienced (4.5 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.6%.


Top Shareholders

Company Information

Intellect Design Arena Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Intellect Design Arena Limited
  • Ticker: INTELLECT
  • Exchange: NSEI
  • Founded: 2011
  • Industry: Application Software
  • Sector: Software
  • Market Cap: ₹19.059b
  • Shares outstanding: 132.26m
  • Website: https://www.intellectdesign.com

Number of Employees


Location

  • Intellect Design Arena Limited
  • Plot No. 3/G-3, SIPCOT IT Park
  • Siruseri
  • Chennai
  • Tamil Nadu
  • 600130
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
538835BSE (Mumbai Stock Exchange)YesEquity SharesININRDec 2014
INTELLECTNSEI (National Stock Exchange of India)YesEquity SharesININRDec 2014

Biography

Intellect Design Arena Limited provides software development and related services for banking, insurance, and other financial services in India and internationally. The company offers platforms and products, such as iGTB, a digital transaction banking platform that provides digital payment, liquidity, supply chain finance, and trade products; iGCB, a full-spectrum suite of consumer banking products comprising digital core, digital lending, digital wealth, and quantum central banking; iRTM, a risk, treasury, and markets platform that supports straight-through processing (STP) and various asset classes over a configurable and scalable platform; Intellect SEEC, an insurance solution for digital distribution, commercial underwriting and risk analytics, and life claims; and Intellect Wealth Qube, a digital wealth management solution with STP from front and mid to back office for private and commercial banks, wealth and asset management firms, advisory firms, broker/dealer’s, trusts, and IFAs to service various client segments. It also develops, sells, and licenses products, as well as implements customization support based on the contracts with its customers. The company was formerly known as Fin Tech Grid Limited. Intellect Design Arena Limited was incorporated in 2011 and is headquartered in Chennai, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 13:09
End of Day Share Price2020/02/17 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.