Ansarada (ASX:AND) share price surges on record quarter

The Ansarada Group Ltd (ASX: AND) share price surged to a five-month high on Tuesday after it posted a record…

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The Ansarada Group Ltd (ASX: AND) share price surged to a five-month high on Tuesday after it posted a record quarter.

The Ansarada share price surged 6% to $1.35 ahead of the close when the IT sector was struggling to keep its head above water today.

In contrast, the S&P/ASX 200 Index (Index:^AXJO) eked out a 0.2% improvement as it gave up most of its morning gains.

Big customer growth drives Ansarada share price higher

But the Ansarada share price remained well bid as management reported a 99% increase in new customer wins for the June quarter compared to the same period last year.

This takes total subscribers on its confidential information sharing platform to 2,566, which is a 41% uplift over 4QFY20.

What’s more, the customer wins have translated to a 17% improvement in revenue to $9.3 million in the latest quarter. Deferred revenue is up a more impressive 76% to $13.6 million over the same periods.

Ansarada share price still lagging peers

Shareholders will be hoping that the latest quarterly marks a turnaround in disappointing performance of the Ansarada share price.

Even with today’s big rally, its shares are still down by nearly a third over the past year following its reverse takeover of The Doc Yard.

That’s surprising given that anything to do with tech and growing recurring revenues would be hot property.

Just look at the Xero Limited (ASX: XRO) share price, Afterpay Ltd (ASX: APT) share price and Life360 Inc (ASX: 360) share price.

Why Investors are overlooking Ansarada

Perhaps one big issue is that not many retail investors understand the value proposition of the Ansarada offering.

It’s software as a service (SaaS) platform allows enterprise customers to share and collaborate on confidential documents. Such a service is useful in mergers and acquisitions (M&As), sharing of board papers and tenders.

These aren’t small niche markets. Ansarada is trying to point out the size of the opportunity by highlighting its use in the global infrastructure boom.

Chasing big market opportunities

Governments around the world are ramping up infrastructure construction as a way to stimulate their economies in the COVID-19 aftermath. Ansarada reckons the size of this opportunity is worth US$3.9 trillion.

Ansarada is leveraged to this theme as it says governments use its Tenders and Deals products to manage high-value/high-risk information.

This isn’t only in the management of the tender process, but also the lifecycle of financing and M&A activities across the infrastructure asset lifecycle.

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Motley Fool contributor Brendon Lau owns shares of Ansarada Group Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Life360, Inc. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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