Stocks - Q : Quality | V : Valuation | PT : Price Trend
Funds - P : Performance | Q : Quality
Funds - P : Performance | Q : Quality
BSE: 517447 | NSE: RSSOFTWARE | IT - Software | Small Cap
Past 10 year’s financial track record analysis by Moneyworks4me indicates that RS Software (India) Ltd is a below average quality company.
The key valuation ratios of RS Software (India) Ltd's currently when compared to its past seem to suggest it is in the Fair zone.
The Price Trend analysis by MoneyWorks4Me indicates it is Weak which suggest that the price of RS Software (India) Ltd is likely to Fall in the short term. However, please check the rating on Quality and Valuation before investing.
Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end.
| Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 | TTM | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROCE % ⓘ | 51% | 5.6% | -12.6% | -19.1% | -17% | -26.8% | -15% | -9.6% | -5.8% | 28.2% | - |
| Value Creation Index ⓘ | 2.6 | -0.6 | -1.9 | -2.4 | -2.2 | -2.9 | -2.1 | -1.7 | -1.4 | 1.0 | - |
Growth Parameters ⓘGrowth Parameters Colour Code Guide ⓘ | |||||||||||
| Sales ⓘ | 346 | 171 | 70.7 | 57.4 | 61 | 60 | 35.4 | 27.5 | 30.1 | 59.5 | 57 |
| Sales YoY Gr. | - | -50.4% | -58.8% | -18.8% | 6.4% | -1.8% | -41% | -22.2% | 9.5% | 97.6% | - |
| Adj EPS ⓘ | 25.3 | 3.1 | -6.3 | -10.2 | -9.3 | -23.4 | -5.5 | -4.3 | -1.5 | 7.4 | 2.8 |
| YoY Gr. | - | -87.7% | -302.9% | NA | NA | NA | NA | NA | NA | NA | - |
| BVPS (₹) ⓘ | 83 | 83.8 | 78.2 | 68.2 | 59 | 34.3 | 28.6 | 23.7 | 21.7 | 29.1 | 31.7 |
| Adj Net Profit ⓘ | 65 | 8 | -16.2 | -26.3 | -23.9 | -60 | -14.2 | -11 | -3.8 | 19 | 7 |
| Cash Flow from Ops. ⓘ | 59.1 | 15.6 | -43.6 | -25.2 | -39.2 | -24.9 | -10.2 | 11.1 | -9.1 | 12.2 | - |
| Debt/CF from Ops. ⓘ | 0 | 0 | -0 | -0.3 | -0.2 | -0.4 | -1.5 | 0.6 | -0.6 | 0 | - |
CAGR Colour Code Guide ⓘ
| 9 Years | 5 Years | 3 Years | 1 Years | |||||
|---|---|---|---|---|---|---|---|---|
| Sales ⓘ | -17.8% | -0.5% | 19% | 97.6% | ||||
| Adj EPS ⓘ | -12.8% | NA | NA | NA | ||||
| BVPSⓘ | -11% | -13.2% | 0.6% | 34% | ||||
| Share Price | -10.6% | 30.8% | 26.9% | -77% | ||||
Performance Ratio Colour Code Guide ⓘ
| Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 | TTM | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Return on Equity % ⓘ | 34.3 | 3.7 | -7.8 | -14 | -14.6 | -50 | -17.6 | -16.3 | -6.6 | 29.1 | 9.1 |
| Op. Profit Mgn % ⓘ | 26.2 | 0.4 | -49.3 | -75.3 | -53.8 | -72.4 | -34 | -34.3 | -5.3 | 30.7 | 17.9 |
| Net Profit Mgn % ⓘ | 18.8 | 4.7 | -22.9 | -45.8 | -39.1 | -100.1 | -40.3 | -39.8 | -12.8 | 31.9 | 12.4 |
| Debt to Equity ⓘ | 0 | 0 | 0 | 0 | 0.1 | 0.1 | 0.2 | 0.1 | 0.1 | 0 | 0 |
| Working Cap Days ⓘ | 89 | 159 | 352 | 393 | 347 | 299 | 394 | 378 | 266 | 182 | 352 |
| Cash Conv. Cycle ⓘ | 29 | 34 | 45 | 54 | 16 | 16 | 59 | 75 | 4 | 11 | 274 |
Return on Equity has increased versus last 3 years average to 9.10%
Sales growth is growing at healthy rate in last 3 years 18.95%
Net Profit has been subdued in last 3 years 0.00%
Sales growth is not so good in last 4 quarters at 9.94%
| Standalone | Consolidated | |
|---|---|---|
| TTM EPS (₹) | 2.8 | 3.4 |
| TTM Sales (₹ Cr.) | 57.3 | 57.3 |
| BVPS (₹.) ⓘ | 31.7 | 22.2 |
| Reserves (₹ Cr.) ⓘ | 69 | 44 |
| P/BV ⓘ | 1.74 | 2.48 |
| PE ⓘ | 19.93 | 16.30 |
| From the Market | |
|---|---|
| 52 Week Low / High (₹) | 49.00 / 370.10 |
| All Time Low / High (₹) | 2.62 / 415.00 |
| Market Cap (₹ Cr.) | 142 |
| Equity (₹ Cr.) | 12.9 |
| Face Value (₹) | 5 |
| Industry PE ⓘ | 30.2 |
| Pledged * | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Business Model continues to be robust
We had introduced RS Software in our coverage when we launched our Rising Stars plan in January 2015. This was because we believed that the company had robust business model. The company develops customised software’s for the electronic payments industry. The Company serves financial institutions, payment networks, payment processors and software companies. Some of its key features are as below:
Why are we removing it from coverage?
Client concentration
RS Software has only one major client – Visa International. It derives almost 80-85% revenues from this single client. Thus, revenues and cash flows are highly dependent on projects from Visa. Any decrease in spending from Visa directly affects the company.
Revenues have become highly volatile
As a result revenues have become highly volatile. RS Software reported revenue de-growth in 3 of the last 4 quarters.
While we knew this when we first started coverage, we decided to bank on the management’s strategy of diversifying its revenue stream. The company is increasing its investments in revamping its sales and marketing division to exploit the vast opportunities present in the electronics payments industry from diverse geographies and other processors. The management is targeting to bring down their dependence on a single client from the existing level to around 70 percent in the next 2-3 years period.
However, nothing concrete has happened in this direction. Also, the fact that the company is a small cap adds more risk to the investment.
Thus, we advise clients not to invest in the company till we see some definite steps from the management towards diversifying this risk.
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 346 | 171 | 71 | 57 | 61 | 60 | 35 | 28 | 30 | 60 |
| Operating Expenses ⓘ | 255 | 171 | 106 | 101 | 94 | 107 | 48 | 38 | 32 | 41 |
| Manufacturing Costs | 7 | 7 | 7 | 6 | 5 | 5 | 3 | 2 | 2 | 2 |
| Material Costs | 0 | 4 | 10 | 1 | 8 | 2 | 2 | 2 | 1 | 5 |
| Employee Cost | 170 | 116 | 66 | 69 | 59 | 57 | 32 | 24 | 21 | 25 |
| Other Costs ⓘ | 78 | 43 | 22 | 25 | 21 | 43 | 11 | 10 | 9 | 10 |
| Operating Profit ⓘ | 91 | 1 | -35 | -43 | -33 | -47 | -12 | -10 | -2 | 18 |
| Operating Profit Margin (%) | 26.2% | 0.4% | -49.3% | -75.3% | -53.8% | -78.7% | -34.9% | -36.4% | -6.4% | 30.7% |
| Other Income ⓘ | 12 | 15 | 12 | 9 | 6 | 16 | 2 | 6 | 1 | 5 |
| Interest ⓘ | 0 | 0 | 0 | 0 | 1 | 1 | 1 | 0 | 0 | 0 |
| Depreciation ⓘ | 6 | 4 | 4 | 2 | 2 | 3 | 4 | 3 | 3 | 4 |
| Exceptional Items ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Profit Before Tax ⓘ | 96 | 11 | -27 | -37 | -30 | -35 | -14 | -8 | -4 | 19 |
| Tax ⓘ | 31 | 4 | -10 | -11 | -6 | 27 | 0 | 4 | 0 | 0 |
| Profit After Tax | 65 | 8 | -17 | -26 | -24 | -63 | -14 | -11 | -4 | 19 |
| PAT Margin (%) | 18.8% | 4.6% | -23.9% | -44.8% | -39.1% | -104.0% | -40.9% | -41.3% | -13.5% | 31.9% |
| Adjusted EPS (₹) | 25.3 | 3.1 | -6.6 | -10.0 | -9.3 | -24.4 | -5.6 | -4.4 | -1.6 | 7.4 |
| Dividend Payout Ratio (%) | 13% | 32% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
Equity and Liabilities | ||||||||||
| Shareholders Fund | 213 | 215 | 201 | 175 | 152 | 88 | 74 | 61 | 56 | 75 |
| Share Capital ⓘ | 13 | 13 | 13 | 13 | 13 | 13 | 13 | 13 | 13 | 13 |
| Reserves ⓘ | 200 | 202 | 188 | 162 | 139 | 75 | 61 | 48 | 43 | 62 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Debt | 0 | 0 | 1 | 8 | 9 | 9 | 15 | 7 | 6 | 0 |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | 0 | 8 | 0 | 0 | 0 |
| Short Term Debt | 0 | 0 | 1 | 8 | 9 | 9 | 7 | 7 | 6 | 0 |
| Trade Payables | 8 | 17 | 7 | 9 | 4 | 3 | 2 | 1 | 2 | 3 |
| Others Liabilities ⓘ | 9 | 7 | -3 | -16 | -18 | 6 | 5 | 6 | 10 | 16 |
| Total Liabilities ⓘ | 231 | 239 | 206 | 176 | 146 | 106 | 95 | 75 | 74 | 93 |
Fixed Assets | ||||||||||
| Gross Block | 37 | 38 | 12 | 13 | 13 | 25 | 25 | 23 | 25 | 27 |
| Accumulated Depreciation | 16 | 29 | 4 | 6 | 7 | 10 | 14 | 15 | 18 | 21 |
| Net Fixed Assetsⓘ | 21 | 9 | 8 | 7 | 6 | 15 | 11 | 7 | 8 | 6 |
| CWIP ⓘ | 1 | 1 | 0 | 0 | 6 | 0 | 0 | 0 | 0 | 3 |
| Investmentsⓘ | 67 | 72 | 108 | 89 | 63 | 42 | 35 | 40 | 33 | 32 |
| Inventories | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Trade Receivables | 46 | 17 | 18 | 10 | 6 | 6 | 10 | 4 | 1 | 11 |
| Cash Equivalents | 68 | 90 | 21 | 25 | 10 | 12 | 10 | 10 | 7 | 19 |
| Others Assetsⓘ | 27 | 50 | 50 | 45 | 55 | 32 | 29 | 14 | 25 | 22 |
| Total Assets ⓘ | 231 | 239 | 206 | 176 | 146 | 106 | 95 | 75 | 74 | 93 |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash Flow From Operating Activity ⓘ | 59 | 16 | -44 | -25 | -39 | -25 | -10 | 11 | -9 | 12 |
| PBT ⓘ | 96 | 11 | -26 | -37 | -30 | -36 | -14 | -8 | -4 | 19 |
| Adjustment ⓘ | -1 | -10 | -10 | -6 | -4 | -9 | 2 | 0 | 2 | -1 |
| Changes in Working Capital ⓘ | -36 | 15 | -8 | 17 | -6 | 21 | 3 | 18 | -7 | -6 |
| Tax Paid ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash Flow From Investing Activity ⓘ | -10 | 10 | -22 | 29 | 25 | 27 | 9 | -4 | 7 | 0 |
| Capex | -3 | -1 | -3 | 1 | -7 | -6 | 0 | 1 | 0 | -5 |
| Net Investments | -13 | -5 | -33 | 19 | 27 | 17 | 7 | -5 | 6 | 1 |
| Others ⓘ | 6 | 15 | 13 | 9 | 5 | 16 | 2 | 1 | 1 | 4 |
| Cash Flow From Financing Activityⓘ | -11 | -4 | -3 | 0 | 0 | 0 | 0 | -8 | 0 | 0 |
| Net Proceeds from Shares ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Net Proceeds from Borrowing ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Paid ⓘ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend Paid ⓘ | -10 | -1 | -3 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Others ⓘ | -1 | -3 | 0 | 0 | 0 | 0 | 0 | -8 | 0 | 0 |
| Net Cash Flow ⓘ | 38 | 21 | -69 | 4 | -15 | 1 | -1 | 0 | -3 | 12 |
| PARTICULARS | Mar'15 | Mar'16 | Mar'17 | Mar'18 | Mar'19 | Mar'20 | Mar'21 | Mar'22 | Mar'23 | Mar'24 |
|---|---|---|---|---|---|---|---|---|---|---|
| Ratios | ||||||||||
| ROE (%) | 34.27 | 3.71 | -8.11 | -13.67 | -14.6 | -52.25 | -17.88 | -16.91 | -6.97 | 29.05 |
| ROCE (%) | 50.98 | 5.58 | -12.63 | -19.06 | -17.04 | -26.8 | -15.01 | -9.64 | -5.79 | 28.23 |
| Asset Turnover Ratio | 1.64 | 0.73 | 0.32 | 0.3 | 0.38 | 0.47 | 0.35 | 0.32 | 0.4 | 0.71 |
| PAT to CFO Conversion(x) | 0.91 | 2 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 0.63 | Working Capital Days |
| Receivable Days | 49 | 68 | 92 | 90 | 48 | 36 | 82 | 94 | 29 | 37 |
| Inventory Days | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Payable Days | 0 | 1,016 | 418 | 3,185 | 316 | 593 | 493 | 387 | 974 | 207 |
R S Software (India) Ltd.(RSL) was incorporated as a private limited company on December 2, 1987 under the Companies Act 1956 and it was converted into a public limited company on February 5 1992. Promoted by R.R. Jain the company is a leading software company providing quality software services and consulting.
In the past more than 18 years, the company grew with global leaders in the electronic payments industry. This has been made possible through their deep engagement in the client's business space, backed by strong application management fundamentals that continue to power their core execution engine.
The company has developed business solutions in Gift & Loyalty, Risk Prediction, Residual Management, Payment Gateway and Merchant Boarding Design to reduce customers cycle time for application development/integration.
The company is having ability to scale up and manage large applications like development, maintenance, testing, 24/7 support for payment industry companies
Services offered by the company:-
Payment Solutions
Technology Solutions
Milestones
Achievements/ recognition:-
MoneyWorks4Me rating and ranking of funds for SIP is available to subscribers only. Moneyworks4Me is not a rating and ranking agency, however it is required that users have a way of selecting funds and building a Portfolio. The method used by it are described below to enable users to understand the logic behind the rating and ranking Subscriber will find more details on this in the various content made available from time to time. In case you need more please write to besafe@moneyworks4Me.com
MoneyWorks4Me rates and ranks mutual funds based on the following data-driven system:
Funds ranking in screeners: Performance Consistency and Quality are two parameters used for ranking funds for SIP. The ranking as follows GG, GO, GR, OG, OO, OR, RG, RO and RR.
With the same color-coded funds, the one with the higher Average 3-year rolling returns (over 5 to 10 years), the number that appears in the Performance tag, ranks higher.
Here is the summary:
The third tag Upside Potential is not relevant for SIP. It is relevant for lumpsum investments in Mutual Funds.
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