Rs 6/Share Dividends: Rs 1,000 Midcap IT Stock Ex-Dividend Next Month, Gives 2,960% Returns; More Steam To Buy

Tanla Platforms is another IT company, that is in the limelight after its Q3 results for FY24. This IT player not only witnessed double-digit growth in its revenue and PAT on a year-on-year basis but also declared rewards for investors. Tanla is set to pay dividends of up to 600% of its profitability. Yes Securities recommend buying on Tanla due to its credible play on the rising demand for CPaaS solutions across industries.

Tanla Platforms Dividend:

The company declared an interim dividend of 600% amounting to Rs 6 per share having a face value of Re 1 each. The company fixed February 5, 2024, as the record date to determine the entitlement of the shareholders for the payment of Interim dividends.

In the previous fiscal, Tanla had paid dividends up to 1,000% amounting to Rs 10 per share.

Currently, its dividend yield is at 0.96%.

Tanla Platforms Share Price:

Tanla's stock price stood at Rs 1,037.35 apiece, down by 1.16% on BSE with a market cap of Rs 13,948.19 crore. In a year, Tanla shares have gained by over 60%.

But in 5 years, this midcap stock has jumped by nearly 2,659% on BSE. The stock was around Rs 30 levels in early 2019.

Using the Axis Direct calculator, if Rs 1,00,000 was invested in Tanla shares in early January 2019, then their investment has skyrocketed to a corpus of over Rs 30.55 lakh in 5 years as of now. This will be a massive 2955.52% return on your portfolio.

Tanla Platforms Q3 Results:

In Q3FY24, the company's profit after tax increased by 20.3% year-over-year to Rs 1,401 million. Profit after tax margin at 14.0%. While its revenue increased by 15.3% year-over-year to ₹10,026 million. Further, EBITDA at ₹1,928 million. EBITDA margin at 19.2% in the quarter.

Uday Reddy, Founder Chairman & CEO, of Tanla Platforms Limited said, "We've had a good start to the year - signing the first commercial agreement with Wisely ATP. We have strengthened our ESG efforts
and secured S&P Global ESG Score of 68, being placed in the top 99 percentile of all companies in the software industry segment."

Tanla transforms the way the world collaborates and communicates through innovative CPaaS solutions. Founded in 1999, it was the first company to develop and deploy A2P SMSC in India.

Tanla Platforms Outlook:

In its brokerage report, Yes Securities said, "Tanla Platform (TANLA) reported muted financial performance for the quarter. The sequential revenue growth and EBITDA margin were below expectations. It reported sequential revenue growth of (0.6%) QoQ, led by (0.7%) QoQ decrease in the revenue of Enterprise business and a 0.5% QoQ increase in revenue of Platform business. There was a sequential decrease in EBITDA margin (down 28 bps QoQ) on higher SG&A."

Further, the brokerage's note added, "It is a credible play on the rising demand for CPaaS solutions across industries for achieving enhanced customer engagement. Also, an increase in smartphone penetration and a greater regulatory push towards mandatory SMS alerts would drive the CPaaS market. As per industry estimates, the Global CPaaS market is expected to grow at CAGR of 20% plus from CY20 to CY25E, led by faster adoption of multichannel
communication."

Also, the adoption of CPaaS-based A2P messaging across industries continues to drive volume growth for both enterprise and platform segments of Tanla, as per the brokerage.

Further, it said, "Rising share of higher margin platform segment would drive EBITDA margin of the company. We estimate a revenue CAGR of 15.7% over FY23‐26E with an average EBIT margin of 18.6% over the period. We maintain our BUY rating on the stock with a revised target price of Rs 1,400/share based on P/E of 20x on FY26E. The stock trades at P/E of 18.1x/14.9x on FY25E/FY26E."

There is a potential upside of nearly 35% in Tanla Platforms ahead compared to the current market price.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.