Birlasoft, the smallcap software services provider, clocked more than 300 percent gains in the last one year following the sustained momentum in the IT space. In fact the stock surpassed Rs 300 mark for the first in its history in May 2021, and hit a record high of Rs 341.80 on May 27, registering more than 22 percent rally in the current week, especially after healthy earnings growth with robust deal wins in the quarter ended March 2021.
Analysts, who cover this stock, reiterated their bullish view with a "buy" call following quarterly earnings, and expect strong earnings, at least, in the coming couple of years.
"We maintain buy on Birlasoft with a revised target price of Rs 335, given strong earnings growth potential and reasonable valuation," said Sharekhan which expects the company to report revenue growth at a 15 percent CAGR over FY2021-FY2023 and earnings to record a growth of 27 percent CAGR.
Net cash improved to Rs 1,119 crore at the end of March 2021, implying 15 percent of market capitalisation of Rs 7,439 crore on May 21. The market cap on May 27 stood at Rs 9,100 crore, implying over 22 percent growth from last Friday's closing.