Genesys International Share Price Gains As Elara Initiates Coverage With 81% Upside

The share price of Genesys International Corp. soared over 10% on Monday after Elara Capital initiated coverage on the stock with a 'buy' rating and a target price of Rs 1,370 apiece, implying a potential upside of 81%. 

The geospatial solutions provider, which debuted on the stock market on Nov. 28, 2023 at Rs 354.90 apiece, posted an intraday high of Rs 834.35.

In its note, Elara Capital highlighted Genesys' leadership in India's rapidly expanding geospatial market, projected to reach Rs 29,300 crore by 2030. The brokerage attributed this growth to supportive government initiatives, such as the National Geospatial Policy 2022 and PM Gati Shakti, which are driving demand for advanced geospatial solutions.

Genesys stands out for its technological advancements, including its 3D Digital Twin solutions, AI-powered mapping capabilities, and real-time data analytics, enabling the company to secure high-value projects, such as the NEOM City initiative and the Mumbai 3D City Model. The company’s current order book stands at Rs 3,900 crore, with an additional qualified pipeline worth Rs 2,400 crore, according to the brokerage. 

Elara Capital projects a robust revenue compound annual growth rate of 54% during fiscal 2024 through 2027, supported by operating leverage and high-value contracts, which are expected to maintain the Ebitda margin above 40%.

The firm’s client portfolio includes major players like Microsoft, Google, Reliance Industries, UltraTech Cement and Bharti Airtel.

While the outlook is promising, Elara Capital noted risks related to high working capital days, dependency on government projects, and customer concentration. However, it also acknowledged management's ongoing efforts to mitigate these risks through diversification strategies.