Ramco Systems Q1 Review - Mixed Results; Healthy Order Book, Expanding Footprint: Dolat Capital

Dolat Capital Report

Ramco Systems Ltd. reported USD revenue growth of 4.1% QoQ (our estimate: +0.2%) led by Aviation segment growth of 14% QoQ. Ebitda margins continued to be positive and improved to 2.5% in Q1 versus 1.6% in Q4 (our estimate: +3.5%) led by continued optimization.

Ebitda (excluding forex) stood at Rs 15 million.

Management, while not providing guidance, stated that delays in the past with respect to deal making are opening up and progressing well, implying a positive FY25 outlook for deal activity and growth.

Ramco Systems is well placed to benefit from deal wins, timely conversions and product acceptance over next two years. Noting this, we have largely retained FY25/FY26 revenue growth estimates and still expect business to turn PAT positive by Q2 FY27.

Maintain ‘Buy’ rating with DCF-based target price of Rs 450 (implies P/S of ~2.6 times on FY26E basis).

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