Docmode Health Technologies Limited IPO Analysis

What Docmode Health Technologies Do?

Using both online and offline learning approaches, Docmode Health Technologies Limited was established in 2017 to offer integrated learning solutions to learners and healthcare professionals globally.

Conferences and workshops are among the company's offline learning modules, while courses created by the company's content development team or by medical associations, medical schools, experts, and opinion leaders are among the online learning modules.

Docmode Health Technologies Limited Financial Summary

Analysis

Assets   

1. Trend Analysis: The assets have consistently increased from 567 Lakh to 1,764 Lakh over the periods, showing a positive trend. This suggests potential business growth, acquisitions, or increased investments in assets. 

2. Interpretation: The growth in assets signifies the company's expanding scale and financial stability, which is generally considered positive.

Revenue

1. Trend Analysis: Revenue has experienced fluctuations, notably in the most recent period. This could be due to various factors such as changes in market conditions, customer demand, or operational issues. 

2. Interpretation: A decline in revenue may raise concerns about the company's ability to generate income. Further investigation into the reasons behind the decrease is recommended.

Profit After Tax

1. Trend Analysis: Profit after tax has shown an overall increasing trend, recent growth of 111.3% indicating improving profitability over the periods.

2. Interpretation: The consistent growth in profit suggests effective cost management or revenue generation strategies, reflecting positively on the company's financial health.

Net Worth

1. Trend Analysis: Net worth has experienced substantial growth, indicating a strengthening financial position.

2. Interpretation: The increasing net worth implies that the company has accumulated more assets than liabilities over time, contributing to its overall financial stability.

Reserves and Surplus

1. Trend Analysis: Reserves and surplus have shown a positive trend, indicating that the company is retaining earnings and building financial reserves.

2. Interpretation: Healthy reserves and surplus provide a cushion against financial uncertainties and can be utilized for future investments or to cover unexpected expenses.

Total Borrowing

1. Trend Analysis: Total borrowing has fluctuated over the periods, with a slight decrease in the most recent period.

2. Interpretation: While a decrease in total borrowing is generally positive, it's crucial to understand the reasons behind this change. It could be a result of successful debt management or reduced financing needs.

Key Performance Indicators

Analysis

1. ROE (Return on Equity): Exceptionally high at 80.03%, signifying robust returns generated on shareholder equity.

2. ROCE (Return on Capital Employed): ROCE stands at 22.46%, reflecting the company's efficiency in utilizing capital for profitability.

3. Debt/Equity Ratio: A relatively high debt/equity ratio of 2.44 indicates substantial financial leverage and potential risk.

4. RoNW (Return on Net Worth): RoNW of 56.06% demonstrates strong returns in relation to the company's net worth.

5. P/BV (Price-to-Book Value): P/BV ratio at 4.85 suggests the market values the company well above its book value, indicating investor confidence.

Overall Assessment

The company exhibits positive signs with growing assets, improving profitability, and a strengthening net worth.
However, the decline in revenue requires closer examination to identify potential challenges or shifts in the business environment.

The business operates in the dispersed market. It has reported decreasing margins in the face of competition, maybe as a result. Even though the issue seems fairly priced given its FY24 annualized profits, it should only be purchased by knowledgeable investors as a medium-term parking fund. The little paid-up equity capital after listing suggests a longer time horizon for mainboard migration.

The prudent management of reserves and a decrease in total borrowing are positive indicators of financial stability. It's important to conduct a more detailed analysis, considering industry benchmarks, market conditions, and specific company strategies to make comprehensive business recommendations.