📈 Company Growth and Financials
Performance Overview:
- Revenue:
- Q3 FY25: ₹221 crore (up 29% YoY, 9% QoQ).
- 9M FY25: ₹603 crore (up 18% YoY)EBITDA:
- Q3 FY25: ₹27 crore (up 29% YoY, 19% QoQ).
- 9M FY25: ₹70 crore (up 17% YoY)
- Net Profit (PAT):
- Q3 FY25: ₹17.72 crore (up 52% YoY, 53% QoQ).
- 9M FY25: ₹39.71 crore (up 25% YoY)
- Return on Capital Employed (ROCE):
- FY24: 10%, reflecting stable capital efficiency.
Allied Digital has delivered strong revenue and profit growth, supported by digital transformation projects, enterprise IT solutions, and Smart City contracts. Higher EBITDA margins and profitability improvement indicate strong execution capabilities.
🛠️ Order Book and Business Expansion
Key Developments:
- Enterprise IT and Digital Services:
- Secured multiple contracts from Fortune 500 companies for end-user IT support.
- Expanded cybersecurity services with a major vaccine manufacturer to protect critical infrastructure.
- Smart City & Cloud Solutions:
- Additional order in Smart Industrial Township project to support Maharashtra’s economic growth.
- Large-scale cloud deployment project to streamline housing-related approvals.
- International Expansion:
- US operations strengthened with new IT contracts in banking, healthcare, and education sectors.
Allied Digital has successfully diversified its revenue streams across IT services, Smart Cities, and cloud-based solutions while expanding its global footprint in the US, Europe, and APAC regions.
🚀 Future Projections
Growth Expectations:
- Revenue Outlook: Continued double-digit growth expected in FY26, driven by enterprise IT services, Smart City projects, and cybersecurity solutions.
- Profitability Improvement: EBITDA margins are expected to improve with higher recurring revenue from long-term service contracts.
- Strategic Partnerships:
- Partnering with government agencies for digital transformation initiatives.
- Expanding AI-driven automation and cloud-based IT solutions.
With a robust order book, strong execution capabilities, and an expanding presence in Smart Cities, AI, and cloud services, Allied Digital is well-positioned for sustained revenue growth and higher profitability in the coming years.
💰 Debt and Financial Health
Key Metrics:
- Debt-to-Equity Ratio: Minimal debt, maintaining a strong financial position.
- Working Capital: Stable liquidity position with ₹170 crore cash reserves.
- Capital Efficiency: Improving operational cash flows, supporting long-term investments in R&D.
Allied Digital maintains a strong financial foundation with low debt, allowing it to invest in growth initiatives without significant financial risk.
🌍 Market Size and Opportunities
Total Addressable Market (TAM):
- Global IT Services Market: Expected to grow at a CAGR of 9%, reaching $1.2 trillion by 2027.
- Smart City Market: India’s Smart City spending is projected to reach $50 billion by 2026.
- Cybersecurity Market: Expected to grow at a CAGR of 12%, driven by increasing cyber threats.
Allied Digital is well-positioned to capitalize on high-growth IT sectors, particularly digital transformation, cloud computing, Smart Cities, and cybersecurity.
⚖️ Regulatory and Market Influences
Key Insights:
- No major regulatory issues reported.
- Promoter Holding: Stable at 52%, indicating strong management confidence.
- FII & Institutional Interest: Rising institutional inflows, reflecting long-term investor confidence.
The absence of regulatory risks, stable promoter holdings, and growing institutional interest strengthen Allied Digital’s investment potential.
📊 Technical Analysis
Current Market Trends:
- Support Levels: ₹200, ₹220.
- Resistance Levels: ₹250, ₹275.
- RSI: Around 58-60, indicating a neutral-to-bullish trend.
- Moving Averages:
- 50-day EMA: ₹230
- 200-day EMA: ₹210
- Breakout above ₹250 could trigger a rally toward ₹275+.
The stock is trading in an uptrend, with potential for further gains if ₹250 resistance is broken.
💡 Valuation and Investment Outlook
Key Insights:
- P/E Ratio: Fairly valued at 27.1x earnings, compared to industry peers.
- Short-term Outlook: Bullish above ₹250, indicating near-term upside potential.
- Long-term Outlook: Positive, supported by expansion in Smart Cities, IT services, and cybersecurity.
Allied Digital presents a strong long-term investment opportunity, backed by recurring revenue, strategic expansion, and financial stability.
