Buy HCL Tech; target of Rs 470: PINC Research

31513 Investors following HCL Tech. Share this News with them.

0

Like this story, share it with millions of investors on M3

Buy HCL Tech; target of Rs 470: PINC Research

PINC Research is bullish on HCL Technologies and has recommended buy rating on the stock with a target of Rs 470 in its January 17, 2012 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

RELATED NEWS Expect higher restructuring for PSUs: Prabhudas Lilladher Buy Infosys; target Rs 3103: Maximus Securities Buy Infosys; target Rs 3450: Arihant capital markets ALSO READ See previous views by PINC Research See what other Experts & Brokerages are saying about HCL Tech See messages about HCL Tech HCL Tech BSE | NSE 31/05/12 Are Mutual Funds betting on HCL Tech?

PINC Research is bullish on HCL Technologies and has recommended buy rating on the stock with a target of Rs 470 in its January 17, 2012 research report.

"HCL Tech, revenue grew 2%QoQ to USD1,022mn. Rupee revenue grew 12.8%QoQ to Rs52,452mn, in-line with expectation. EBITDA expanded 140bpsQoQ to 18.5%. PAT grew 15.2%QoQ to Rs5,727mn. Forex loss of Rs758mn led to lower than expected PAT. EPS grew 11.2%QoQ to Rs7.9."

"Growth was led by US which grew 7.4%QoQ. Europe grew 2.7%QoQ while ROW declined 16.1%QoQ. Enterprise Application Services (EAS) grew 4.5%, Engineering and R&D grew 3.6%QoQ and IMS declined 3%QoQ. Manufacturing grew 3.7%QoQ, Financial Services grew 2.8%QoQ, Retail grew 5.6%QoQ and Healthcare grew 15.4%. However, Telecom declined 4%QoQ and Energy & Utilities declined 18.4%QoQ. Top 5 clients grew 5.3%QoQ and top 10 clients 2.4%QoQ. Added 59 new clients compared to 66 in Q1FY12. Total active clients are 516 compared to 480 in Q1. 2 new clients were added in USD100mn+ category. Gross hiring of 7,804 employees. Total headcount is 83,076 (3.2%QoQ). Utilisation incl. trainees declined 10bpsQoQ to 69.6%. Attrition rate (IT Services) declined 20bps to 15.7%."

"The expectations are low and the financial performance has been inline soothing the concerns that HCL Tech's margin is likely to dip drastically due to undercutting. HCL Tech trades at 30% discount to Infosys on FY13 PER multiples. At the CMP of Rs406, the stock is trading at 11x FY13E EPS. Maintain 'BUY' recommendation on the stock with a target price of Rs 470 based on 13.5x FY13E EPS," says PINC Research report.

Shares held by Mutual Funds/UTI

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment