homeearnings NewsNewgen Software stock up as CEO believes March quarter to be stronger than December one
Newgen Software stock up as CEO believes March quarter to be stronger than December one
Newgen Software Technologies reported Q3FY23 earnings with a steady 26 percent growth in revenue, however EBITDA margin saw some pressure.
Newgen Software Technologies share rose over 2 percent to Rs 406.95 on the BSE a day after the firm reported a steady 26 percent growth in revenue in October to December quarter. The earnings before interest taxes depreciation and amortisation (EBITDA) margin, however, saw some pressure.
In an interview with CNBC-TV18, chief executive officer Virender Jeet said that for the first nine months, the company had broad-based growth across all the markets. “Seasonally, Q3 and Q4 are stronger quarters for us on the revenue side. We expect Q4 (FY23) also to be a strong quarter,” he said.
Newgen Software is known for its high gross margins, and Jeet guaranteed the company would sustain net margins of 17-18 percent. He also noted that there is a seasonality to deal flows, but the full FY23 growth rate would exceed that of the nine-month FY23 growth rate.
Jeet highlighted the strong traction the company was seeing from all its clients in India, West Asia, and APAC. He acknowledged that the company's revenue contribution from the US and Europe is sub-30 percent. Despite this, Jeet said the company was witnessing a pickup in the banking and insurance sector.
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In APAC, the company's profitability had been impacted by investment in a new subsidiary in Australia. Jeet acknowledged that there had been a slight margin decline in certain pockets but stated that revenue from Australia would help to bring margins back.
In terms of the company's US business, Jeet stated that they were trying to reset it. Overall, the CEO was optimistic about the company's future and is confident in the growth opportunities available to Newgen Software.
For more details, watch the accompanying video
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