Datamatics Global hits 20% upper circuit, zooms 65% in three days

There has been a significant increase in movement in share price and volume of mid-cap information technology-enabled services (ITeS) companies in the last few days

Shares of Datamatics Global Services were locked in the upper circuit of 20 per cent at Rs 300.90 on the BSE on Monday amid an over five-fold jumped in trading volumes. In comparison, the S&P BSE Sensex was down 616 points or 1.2 per cent at 52,524 points around 2.16 pm.

A combined 3.09 million equity shares, representing 5.2 per cent of the total equity of Datamatics had changed hands on the counter on the NSE and BSE at the time of writing this report. There were pending buy orders for around 360,000 shares on both the exchanges, data shows.

In the past three trading days, the stock of the information technology (IT) software products company has surged 65 per cent. The company in a filing has clarified that significant movement in the share price/ volume behaviour of the scrip is purely due to market conditions and are market-driven.

The company further said that there is a significant increase in movement in the share price/volume of mid-cap information technology-enabled services (ITeS) companies in the last few days.

Datamatics provides intelligent solutions for data-driven businesses to increase productivity and enhance the customer experience. With a complete digital approach, Datamatics' portfolio spans across information technology services, business process management, engineering services and big data and analytics, all powered by artificial intelligence (AI).

For the financial year 2020-21 (FY21), USA was the major contributor at 58 per cent whereas contributions from UK, Europe, India and the Rest of World stood at 11 per cent, 5 per cent, 21 per cent and 5 per cent, respectively. In terms of sectoral contribution to the revenue, BFSI, publishing and technology and consulting were the top three sectors as they contributed 27 per cent, 25 per cent and 19 per cent, respectively.

“The pandemic has accelerated digital transformation plans across industries in a new normal world. Worldwide IT spending is forecasted to total US$ 4.1 trillion in 2021, a growth of 8.4 per cent from 2020 and is anticipated to touch US$ 4.3 trillion, moderating a growth to 5.5 per cent in 2022 (Source: Gartner April 2021, Spending Forecast Release).  Global Cloud computing industry is expected to grow from US$ 371.4 billion in 2020 to US$ 832.1 billion by 2025, at a CAGR of 17.5 per cent. Increased automation and agility is expected to drive the cloud computing growth,” Datamatics said in investor presentation.

Industry experts opine that business process management (BPM) industry is witnessing multi-year technology upgrade cycle in 3 key stages - a large-scale shift to cloud; building of applications in cloud-native world; and collaboration between IT service vendors and customers to build new technology solutions. United States continues to remain biggest the market for BPM. Datamatics is seeing specific opportunities in the process automation and dynamic content management areas, the company said.