Guru Investor Ramesh Damani Bets Big on This Multibagger IT Stock – A Game-Changer in Digital Public Infrastructure and eSign Services

In today’s digital world, it’s easier than ever to follow what successful investors are doing. Many people copy the investments of top investors to try and make a profit. One such famous investor is Ramesh Damani, who recently added a new IT stock to his portfolio.

Who is Ramesh Damani?

Ramesh Damani is a well-known stockbroker and a member of the Bombay Stock Exchange. He has a bachelor’s degree in commerce from HR College in Mumbai and an MBA from California State University, Northridge. He’s also known for hosting the show Wizards of Dalal Street on CNBC TV18, where he shares his views on finance and the stock market.

Which Stock Did He Buy?

Damani recently purchased shares of Protean eGov Technologies, a company that builds technology solutions for individuals, businesses, and the government. According to the Bombay Stock Exchange (BSE), Damani bought 422,069 shares in the September quarter, which equals a 1.04% stake in the company. His investment is valued at ₹82.9 crore as of October 21, 2024.

Why Did He Buy Protean eGov Technologies?

While the exact reason for his investment isn’t known, there are several possible explanations.

1. PAN 2.0 Project: On September 2, Protean announced plans to bid for the government’s PAN 2.0 project, which involves building and maintaining part of India’s digital identity infrastructure. Protean has expertise in taxation, digital identity, and pension services, making it a strong candidate for this project. The company also provides services related to Aadhaar, such as e-signatures, e-KYC, and e-authentication, giving it a major role in identity management.
2. Launch of eSignPro: On July 1, Protean introduced a new digital signature solution called eSignPro. This service allows businesses to sign agreements digitally, saving money on printing and paperwork. Financial institutions, for example, spend over ₹200 on handling each document. With eSignPro, they can do this more efficiently and at a lower cost, which may have attracted Damani’s attention.
3. Digital Infrastructure Push: India’s growing digital infrastructure is expected to formalize the economy even more. Protean is a key player in this sector and has been involved in creating a digital agriculture system, including farmer IDs and land records. It is also set to benefit from the National Pension Scheme (NPS) expansion, which could boost its revenue as more people participate in the pension system.

Financial Performance

Despite strong revenue growth, Protean’s profitability has been inconsistent. In June 2024, the company’s net sales were ₹196.54 crore, down by 10.8% from the previous year. Its quarterly net profit also fell by 34.5% to ₹21.09 crore. Operating profit peaked in FY22 but dropped in FY24. However, the company’s expansion into new areas could improve its future financial performance.

Future Outlook

Protean is expected to see growth in FY25, thanks to new products like its RISE API marketplace and central KYC solutions for banks and financial services. Additionally, increasing internet penetration in rural areas could lead to more demand for PAN card services, further boosting the company’s growth.

Stock Performance

The stock has been under pressure recently, falling about 5% in the last five days. However, it’s still up 53% in 2024 and has gained 118% since its IPO in November 2023. The stock reached a 52-week high of ₹2,225 in August 2024, and its lowest point was ₹775 in November 2023.

About the Company

Protean eGov Technologies, formerly known as NSDL e-Governance Infrastructure Limited, was founded in 1995. It creates large-scale technology solutions for critical projects in India, such as digital identity and financial systems.

Should You Invest?

If you believe in Protean’s long-term growth potential, it might be worth considering. However, like with any stock, it’s important to do your own research before making an investment decision.

Happy investing!