Sonata Software Limited (IN:SONATSOFTW)
:SONATSOFTW
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Sonata Software Limited
(SONATSOFTW)
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Rating:72Outperform
Price Target:
₹232.00
▼(-36.38% Downside)
Action:UpgradedDate:03/05/26
The score is driven primarily by strong financial performance (solid profitability, growth, and cash generation). This is partially offset by very weak technical conditions (price below all key moving averages with negative momentum indicators). Valuation is supportive with a moderate P/E and a ~3.1% dividend yield.
Positive Factors
Revenue Growth
Consistent top-line growth demonstrates durable demand for Sonata's digital transformation and cloud services. Over 2-6 months this supports repeatable deal flow, higher pipeline conversion for multi-year programs, and creates opportunities to expand into managed services that drive recurring revenue and margin leverage.
Negative Factors
Reliance on Liabilities
Dependence on liabilities increases refinancing and interest-rate vulnerability if markets tighten. Over a medium-term horizon this can pressure cash flow and constrain discretionary spend or hiring, reducing the firm's ability to fund growth or absorb prolonged client slowdowns without raising costs or cutting investment.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth
Consistent top-line growth demonstrates durable demand for Sonata's digital transformation and cloud services. Over 2-6 months this supports repeatable deal flow, higher pipeline conversion for multi-year programs, and creates opportunities to expand into managed services that drive recurring revenue and margin leverage.
Read all positive factors
Sonata Software Limited (SONATSOFTW) vs. iShares MSCI India ETF (INDA)
Market Cap
₹65.04B
Dividend Yield2%
Average Volume (3M)109.98K
Price to Earnings (P/E)23.9
Beta (1Y)2.02
Revenue Growth12.39%
EPS Growth59.77%
CountryIN
Employees6,043
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)3.90
Shares Outstanding280,424,800
10 Day Avg. Volume87,229
30 Day Avg. Volume109,976
Financial Highlights & Ratios
PEG Ratio0.61
Price to Book (P/B)5.68
Price to Sales (P/S)0.95
P/FCF Ratio16.83
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
₹352.50Price Target Upside-3.33% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)19.03
Revenue Forecast (FY)₹115.05B
Sonata Software Limited Business Overview & Revenue Model
Company Description
Sonata Software Limited, together with its subsidiaries, provides information technology services and solutions in India, the United States, Europe, the Middle East, and Australia. It also offers software development, technical, and product market...
How the Company Makes Money
Sonata Software primarily makes money by selling IT services and solutions to enterprise customers under a mix of (1) project-based engagements and (2) ongoing managed services/outsourcing contracts. In project-based work, revenue is generally ear...
Sonata Software Limited Financial Statement Overview
Summary
Income Statement
85
Very Positive
Balance Sheet
78
Positive
Cash Flow
82
Very Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 105.44B | 101.57B | 86.13B | 74.49B | 55.53B | 42.28B |
| Gross Profit | 12.85B | 13.25B | 15.30B | 10.60B | 8.41B | 6.65B |
| EBITDA | 6.86B | 6.89B | 6.77B | 6.71B | 5.64B | 4.06B |
| Net Income | 4.42B | 4.25B | 3.08B | 4.52B | 3.76B | 2.44B |
Balance Sheet | ||||||
| Total Assets | 46.09B | 47.55B | 51.49B | 43.57B | 25.55B | 19.47B |
| Cash, Cash Equivalents and Short-Term Investments | 3.32B | 6.95B | 11.38B | 9.30B | 8.96B | 7.21B |
| Total Debt | 7.39B | 5.16B | 7.65B | 5.91B | 1.59B | 1.85B |
| Total Liabilities | 28.37B | 30.49B | 37.43B | 30.56B | 14.56B | 10.41B |
| Stockholders Equity | 17.72B | 17.06B | 14.06B | 13.01B | 10.99B | 9.05B |
Cash Flow | ||||||
| Free Cash Flow | -222.40M | 5.76B | 2.55B | 2.27B | 4.41B | 4.41B |
| Operating Cash Flow | 366.30M | 6.44B | 2.81B | 2.68B | 4.50B | 4.43B |
| Investing Cash Flow | -776.70M | -4.36B | -543.10M | -8.55B | -834.70M | -1.14B |
| Financing Cash Flow | -807.00M | -4.33B | -1.08B | 1.87B | -2.71B | -621.00M |
Sonata Software Limited Technical Analysis
Negative
364.65
Price Trends
272.74
Negative
315.11
Negative
347.55
Negative
Market Momentum
-15.22
Negative
41.86
Neutral
36.95
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SONATSOFTW, the sentiment is Negative. The current price of 364.65 is above the 20-day moving average (MA) of 235.52, above the 50-day MA of 272.74, and above the 200-day MA of 347.55, indicating a bearish trend. The MACD of -15.22 indicates Negative momentum. The RSI at 41.86 is Neutral, neither overbought nor oversold. The STOCH value of 36.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:SONATSOFTW.
Sonata Software Limited Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | ₹65.04B | 23.90 | ― | 2.00% | 12.39% | 59.77% | |
70 Outperform | ₹46.73B | 14.66 | ― | 1.62% | 11.91% | -1.02% | |
68 Neutral | ₹59.88B | 42.91 | ― | 1.26% | 21.31% | -16.27% | |
68 Neutral | ₹28.93B | 11.31 | ― | 1.54% | 6.36% | -54.41% | |
67 Neutral | ₹179.65B | 60.10 | ― | 0.08% | 47.18% | 38.90% | |
62 Neutral | ₹103.60B | 25.31 | ― | 1.42% | -2.00% | -25.81% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
IN:SONATSOFTW
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Sonata Software Limited Corporate Events
Sonata Software appoints Balaji Kumar as global Chief Human Resources Officer
Mar 14, 2026
Sonata Software Limited has appointed Balaji Kumar as its Chief Human Resources Officer, effective 14 March 2026, with responsibility for the company’s global People and Talent function from its Bengaluru corporate office. Kumar, who previou...
Sonata Software Unit Files US Bankruptcy Case to Recover $10.64 Million from Client
Mar 7, 2026
Sonata Software North America, Inc., a subsidiary of Sonata Software Limited, has initiated legal proceedings in the United States Bankruptcy Court for the District of Delaware against client OBSA Operating Company, LLC. The action is an involunta...
Sonata Software Completes Dispatch of Postal Ballot Notice and Publishes Statutory Ads
Feb 28, 2026
Sonata Software has notified stock exchanges that it has completed dispatch of its postal ballot notice to shareholders as of 27 February 2026. The company has also published statutory advertisements in regional and national newspapers and provide...
Sonata Software Updates Market on One-on-One Analyst Meeting
Feb 20, 2026
Sonata Software Limited has disclosed that its management held a one-on-one virtual meeting with Aditya Birla Sun Life Asset Management Company Ltd. on 20 February 2026 as part of its regular analyst and institutional investor engagement activitie...
Sonata Software Posts Analyst Call Audio to Strengthen Investor Transparency
Feb 6, 2026
Sonata Software Limited has notified stock exchanges that the audio recording of its analyst and investor conference call held on 6 February 2026 has been uploaded to the investor relations section of its website, in line with SEBI’s disclos...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.