Haywood analyst Pareep Sangha says DataWind’s (DataWind Stock Quote, Chart, News: TSX:DW) strong fourth quarter unit sales bested his expectations.
This morning, DataWind announced it had DataWind Inc. sold more than 300,000 units for the three months ending March 31, 2016, a record for the company. DataWind sold 184,009 units in the same period a year prior.
“Demand remains strong for our low-cost tablets and smart phones equipped with affordable Internet access,” said Suneet Singh Tuli, president and chief executive officer of DataWind. “As our record results reflect, we are seeing tremendous interest in our products from both home shopping network channels and physical retail distribution partners. A key driver of the significant improvement in units sold was our strategic decision to expand our sales and marketing activities for our most affordable products, and, as such, expect to see a slight increase in related expenses reflected in our fourth quarter financial results. These efforts, coupled with the sale of lower-priced units, allowed us to penetrate further into the Indian market, resulting in our record number of units sold for the quarter and consistent top-line growth.
Sangha says the shipments bested his expectations, and thinks even better things could be on the horizon following the company’s anticipated launch with Vodafone India.
“We believe DataWind has a significant growth opportunity in India and the company is well-positioned to be a leader in this market with its products, manufacturing, retail network, carrier relationships and ties to TV home shopping channels,” says Sangha.
In a research update to clients today, Sangha maintained his “Buy” rating and one-year price target of $6.00 on DataWind, implying a return of 272.7 per cent at the time of publication.