Nifty SmallCap Stock Soars 14%, Hits New 52-Week Stock; Do You Own?

Hyderabad-headquartered Tanla Platforms emerged as the top gainer on Nifty SmallCap 250 index on Friday. The stock zoomed by more than 14% on the said index to hit a new 52-week high. Tanla delivered strong first-quarter results for FY24. Both PAT and the top-line front has garnered double-digit growth on a year-on-year basis.

Tanla Platforms share price ended at Rs 1,267.10 apiece on NSE, rising by Rs 149.85 or 13.41%. The stock gained by at least 14.43% when it clocked a fresh 1-year high of Rs 1,287 apiece earlier today.

Investors cheered Tanla for its performance in the three-month quarter that ended on June 30, 2023 (Q1FY24).

During Q1FY24, Tanla registered 35% YoY growth in profit after tax (PAT) to Rs 135.4 crore, while the profit after tax margin was at 14.9%. Revenue increased by 14% year-over-year to Rs 911.1 crore in Q1, while EBITDA stood at ₹182.2 crore and EBITDA margin at 20%.

On Thursday, Uday Reddy, Founder Chairman & CEO, of Tanla Platforms Limited said, "We have delivered strong growth across both Digital Platforms and Enterprise Communications business. Our strategic bets are giving us tremendous scale and reach to enterprises while continuing to have an incredible innovation engine."

Further, the tech firm received board of directors approval for the allotment of f 33,003 fully paid-up equity shares of Re 1 each upon exercise of options granted under Tanla Platforms - Restricted Stock Unit Plan 2021 ("RSU 2021").

In a research note dated July 20, HDFC Securities for Tanla Platforms said that the enterprise segment is expected to grow 2.5% QoQ while the platform will be soft at 1% QoQ growth. The EBITDA margin will decline by 53bps QoQ to 19.4% and the ValueFirst integration impact will come in Q2FY24E. The investment in Wisely is expected to generate results in 2HFY24E; the Wisely ATP (anti-phishing) product is gaining traction and is under the POC stage with three large banks. The growth and margins are expected to recover supported by growth uptick in the enterprise (volume, price hike and acquisition) and platform business (Wisely).

Hence, the brokerage expects revenue/EPS CAGR of 24/26% (organic 18/20%) over FY23-26E and maintain our BUY rating with a TP of Rs 1,350 based on 23x June-25E EPS.

Year-to-date, Tanla Platforms share price has gained by nearly 77% on NSE. In a span of 5 years, the stock has skyrocketed by a breathtaking 3,296.51% on the exchange, making many investors rich.

As one of the world's largest CPaaS players, Tanla processes more than 800 billion interactions annually and about 63% of
India's A2P SMS traffic is processed through Trubloq, making it the world's largest Blockchain use case.

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