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Monday, April 18, 2005

Sharekhan Stock Update


Geometric Software Solutions 
Cluster: Emerging Star
Recommendation: Buy
Price target: Rs550
CMP: Rs485.00
 
Growing in double-digits 
 
Result highlights
  • Geometric Software Solutions' overall results are in line with our expectations.
  • The top line is up by 14.7% in rupee terms quarter on quarter (qoq). In dollar terms the same is up by 17.2%.
  • The operating profit margin fell during the quarter but if we ignore the one-time expenses incurred during the period the same is largely in line with expectations.
  • The company has given a robust growth guidance for FY2006: a growth of 45-50% in the top line in US Dollar terms and a similar growth at the net profit level.
  • At the current market price the stock is quoting at 12.3x FY2006E earnings.
  • We maintain our Buy call on the stock.