RDY -7.52%: An interesting smaller software business exposed to defensive areas such as local government, education & justice that we’ve owned in the past reported their 1H23 result today and talked to positive trends for the 2H – the share price was down but three things stood out to us: 1) 1H revenue was a touch softer than expected, but it seems this is more a timing issue 2) Enterprise momentum is building with RDY signing $10.8m of high value deals vs $8m signed for the whole period of FY22. 3) FY23 guidance and longer-term targets were reaffirmed.
RDY had been the focus of a private equity bid that was recently pulled, however we suspect there could be more to play out here. This is now being added to our Hitlist for the Emerging Companies Portfolio.
MM is bullish on RDY ~$3.40
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