Goldman Sachs Backed stock in focus after receiving ₹5.93 Cr incentives under PLI scheme 2.0

A Goldman Sachs-backed company, one of India‘s leading high-end computing solutions (HCS) providers, has come into focus after receiving an incentive of Rs.5.93 crores under the Production Linked Incentive (PLI) Scheme 2.0 for IT Hardware. The incentive highlights the company’s role in strengthening India’s domestic electronics manufacturing ecosystem.

Price Variation

During Friday’s trading session, shares of Netweb Technologies India Ltd reached an intra-day high of  Rs.1,514.85 each, falling from the previous closing price of Rs.1,529.65 per share. However, the shares have retreated further and are trading at Rs.1,474.65 apiece. 

What Happened 

Netweb Technologies has received an incentive of Rs.5,93,97,758 under the Production Linked Incentive (PLI) Scheme 2.0 for IT Hardware for the period from July 1, 2023, to March 31, 2024. This incentive highlights the company’s contribution to strengthening India’s high-end computing manufacturing with its advanced in-house design and production capabilities.

The recognition from the Ministry of Electronics and Information Technology (MeitY) reflects Netweb’s role in delivering enterprise-grade systems and scalable computing solutions while supporting the government’s vision of ‘Atmanirbhar Bharat’. The company thanked the Government of India and MeitY for their support in promoting local manufacturing.

Order Book and Pipeline

The current order book of Netweb Technologies stands at Rs.360 crores, with a strong pipeline supported by ongoing capability enhancements. The order book typically spans 12 to 16 months, reflecting steady conversion of orders into revenue. Management has highlighted a consistent inflow of new orders, ensuring a healthy balance between fresh bookings and completed projects.

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Margins Update

For the 9 months of FY25, the EBITDA margin of Netweb Technologies stood at 13.7 percent, showing a slight year-on-year improvement from 13.6 percent. Management remains confident in maintaining around a 14 percent EBITDA margin for the full year, despite minor fluctuations expected due to the execution of large orders.

Financial Overview

In its recent financial update, Netweb Technologies India Ltd reported consolidated revenue of Rs.334 crores for Q3 FY25, reflecting a 32 percent increase compared to Rs.253 crores in Q3 FY24. Moreover, the company reported a 15 percent increase in net profits to Rs.30 crores in Q3 FY25, from Rs.26 crores posted during the same period last year.

Ratio Analysis

The company has a Return on Capital Employed (ROCE) of 29.26 percent and a Return on Equity (ROE) of 21.24 percent. Its Price-to-Earnings (P/E) ratio stands at 85.62, higher than the industry average of 62.27. Furthermore, the company maintains a current ratio of 2.51, a debt-to-equity ratio of 0.02, and an Earnings Per Share (EPS) of Rs.17.85. 

Shareholding Pattern

As of December 2024, the shareholding pattern of Netweb Technologies India Ltd indicates that promoters hold a 71.39 percent stake in the company. Foreign Institutional Investors (FIIs) hold 11.10 percent, while Domestic Institutional Investors (DIIs) account for 5.23 percent of the total shareholding. Retail Investors hold a 12.28 percent stake in the company. Among the institutional investors, Goldman Sachs holds a 1.59 percent stake in Netweb Technologies.

Written by – Siddesh S Raskar

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