Accumulate Route Mobile; target of Rs 1631: Arihant Capital

Arihant Capital's research report on Route Mobile

Route Mobile beat revenue estimates in Q1FY23: Reported revenue of INR 7,290 Mn up 16.4% QoQ/ 101.1% YoY against our estimate of INR 7200 Mn. The growth was led by digital acceleration which also helps increase client acquisition. The company, gross profit margin stood at 22.4% in Q1FY23 against 21.1% in Q4FY22 and 21.95% in Q1FY22 respectively.

Outlook

We value the stock at a PE multiple of 27x to its FY24E EPS of INR ~60, which yield a revised target price of INR 1,631 per share ( earlier target price; INR 1,389 per share). We upgrade our rating to Accumulate from Hold earlier.

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