Emudra Ltd – Digital Signature Certificate Provider Share Performance

Emudra Ltd Share Overview: 

eMudhra Ltd, established in 2008, holds the dominant position as the largest licensed Certifying Authority in India’s digital signature certificate market, commanding a market share of over 35%. The company specializes in delivering digital trust services and enterprise solutions to individuals and organizations across various industries. 

Under digital trust services, EMudhra provides a diverse range of certificates for both individuals and organizations. This includes SSL (Secure Socket Layer)/TLS (Transport Layer Security) certificates and device certificates, which are specifically designed for Internet of Things (IoT) applications, all contributing to the establishment of a robust digital trust infrastructure. Additionally, eMudhra’s enterprise solutions division offers Digital Security and Paperless Transformation Solutions. These solutions seamlessly integrate with the Digital Trust Services business, providing valuable support to customers operating in different industries. 

Having issued over 50 million digital signature certificates since its establishment, eMudhra serves a wide range of subscribers who rely on these certificates for their digital transactions. The company maintains strong collaborations with major government and banking clients, establishing close working relationships with them. 

IPO Flashback: 

The initial public offering (IPO) of eMudhra commenced on May 20, 2022, with a price range set at Rs 243 to Rs 256 per share. The lot size for the IPO was 58 shares, and the total issue size amounted to Rs 412.0 crore. The IPO closed on May 24, 2022, and by the end of the closing day, it was oversubscribed by 2.72 times. Upon listing, the final price per share settled at Rs 256. On June 01, 2023, eMudhra celebrated its first IPO anniversary, during which it delivered an impressive absolute return of 70% from its listing price. 

Stock Performance 

Shares of eMudhra opened today at Rs 430.45, lower by 1.43% from the previous day’s closing price of Rs 436.70. Currently, the stock is trading around Rs 438. Over the past month, the company has generated an impressive absolute return of 45.78%, and in the last three months delivered 67.76%. However, the stock has been underperforming for the past seven to eight months and its 52-week high and low are Rs 445 and Rs 206.90. The company’s total market capitalization stands at Rs 3421.13 Crore. The promoter holds a significant stake in the company, accounting for 57.7% of shares. FIIs hold 4.16% of shares, while DIIs hold 10.65%. 

Financial Performance 

In the fourth quarter of FY23, eMudhra witnessed a remarkable surge in revenue, experiencing a 69% YoY growth from Rs 45 crore to Rs 77 crore. The company achieved an operating profit of Rs 24 crore, resulting in an operating profit margin of 31%. Its net profit for the quarter amounted to Rs 16 crore.

In FY23, the company’s revenue showed a solid growth of 36.20% YoY from Rs 183 crore to Rs 249 crore. The company’s operating profit increased from Rs 68 crore to Rs 87 crore, with an operating profit margin of 35%. It is worth noting that the company has consistently maintained a margin above 30% since FY 2019, except for FY 2020. The net profit for FY23 stood at Rs 61 crore. 

eMudhra exhibits robust financial performance, with a ROCE of 24.1% and ROE of 22.5%. Over the past three years, the company’s revenue has grown at a CAGR of 28.8%. Similarly, its operating profit and net profit have shown significant growth rates of 42.1% and 49.3% CAGR, respectively. Furthermore, the company’s order book has been consistently increasing, indicating a positive outlook for future growth.