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Systems Limited(SYS) Company Overview: -

Sarmaaya Desk
Sarmaaya Content Team

Systems Limited is a public limited company founded in Pakistan under the Companies Ordinance of 1984, which has since been abolished. Systems Limited makes use of cloud services to assist you in discovering new possibilities. The Company's main lines of business include software development, software trading, and business process outsourcing services. Systems Limited is based in Lahore, Pakistan, and was formed in 1977.

In North America, the Middle East, and Pakistan, Systems Limited operates in software development, software trading, and business process outsourcing (BPO) activities. Digital commerce, business applications, data management and analytics, project management outsourcing, cloud services, application development and integration, security, and IT infrastructure are among the services provided by the organization. A product of Systems Limited is Partner Communication. Partner Communication transmits data between large enterprises via VAN-based or direct-to-partner connections; and Middleware Connector, which unifies existing e-commerce solutions with Dynamics 365, eliminating error-prone and time-consuming manual platform integration and creating a single synchronized system for centralized channel management.

Retail Analytics, a BI platform for the retail industry with built-in metrics and KPIs, reports, and dashboards; and HauteLogic, a suite of modular tools for intelligent fashion supply chain and direct-to-consumer operations are also available from the company. HauteLogic, a suite of modular tools for intelligent fashion supply chain and direct-to-consumer operations; SysHCM, a human resources solution; and TrIPS, a cloud-based insurance solution are among the software offered by Systems Limited. Its clients include the retail, consumer products, financial services, and telecommunications industries, as well as the government.

Company Snapshot:
SYS company snapshot

The total market value of SYS at present share price is Rs. 89.17 Billion

Sales and Profits: -

The table shows the sale and the gross profit that the company has made in some previous years. All values are in thousands:

  2020 2019 2018 2017 2016 2015
Sales 7,513,767 5,348,569 3,761,156 2,910,800 2,680,324 2,263,290
Gross profit 2,797,981 1,776,380 1,178,537 862,108 797,486 756,745
SYS’s Performance: -

Systems Limited stock is more volatile than the average of other Pakistani stocks in the stock exchange so it will provide more return than the stocks in the Pakistan stock exchange. More returns mean more profit for the investors. Systems Limited stock is selling at a lower price than the book or fair value which means that it would be a profitable trade if investors buy this as it is deemed to increase its stock price which can lead to direct profits. It is an undervalued stock and has the potential to give a sufficient amount of profit to the investors.

Earning per share

EPS in 2018, 2019, and 2020 was 8.19, 11.05, and 17.66 respectively. It is a good value as we see. The EPS can be seen increasing every year which means that the company is moving in the right direction and is increasing. This means that the money investors get from the stock is increasing with time. Systems Limited also has quality earnings making it an attractive investment. Other than this in Twelve trailing month period, the EPS is 17.75 which is good.

Net Profit vs Gross Profit

Net profit and gross profit margins can be seen as stable and increasing. The net profit and gross profit are increasing, showing that the company will benefit the investors in the longer run. The earnings and growth profit have increased significantly from 2018 to 2020 which is a sign for investors.

Financial Health: -

(All values are in thousands):

  2020 2019 2018 2017 2016
Assets 9,836,639 6,717,216 4,999,170 3,830,116 2,174,666
Liabilities 2,580,952 1,500,749 900,000 418,939 258,097
Equity 7,253,686 5,216,466 4,078,870 3,211,179 2,916,369
Summary: -

In these times of the Coronavirus people preferred using different software and Artificial Intelligence solution to their benefit. Different retail stores including Khaddi partnered with Systems Limited to use retail software that helped both the company. In 2018 according to Profit magazine, semiannual profits of the company increased and that is where the boom of the company started.

Revenue Breakup By Region and Revenue Breakup By Offerings

This pie chart shows that most of the revenue of the company is generated from North America and the Middle East which means the foreign investment is guaranteed. With an increase in digitalization, Systems can profit as approximately half of their revenue is generated from the digital and IT business.

Other than this according to the company Financials more than 82% of company sales consist to export sales to North America and Europe. So most of the revenue is coming in the forms of foreign currency like pounds and dollars which means that the revenue will increase with the devaluation of the rupee and increase in value of the dollar due to which the stock is a pretty good investment.

This is highly recommended stock and this is the prime time to buy a stock as it is undervalued. As the future belongs to AI and computers the company has a great future in the market of Pakistan.

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