Buy Quess Corp, target Rs 1350: Shailendra Kumar

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Shailendra Kumar

While manpower outsourcing/ Business Services (manpower outsourcing + facility management+ maintenance services) is a mature business in the developed world, such business is still in nascent stage in India.

During 1990-2000, Serco leading player in this space in UK in its early growth phase reported revenue CAGR of 23 percent and market cap went up at CAGR of 44 percent. Quess Corp has created a great platform in the large business services space.

Management is confident of 50 percent+ YoY growth for the foreseeable future: 20 percent organic and 30 percent from acquisitions. Operating cashflow to EBITDA is set to increase going forward. Our DCF based near term target is Rs 1,350.