Buy Hexaware Technologies; target of Rs 398: Cholamandalam securities

Cholamandalam securities is bullish on Hexaware Technologies has recommended buy rating on the stock with a target price of Rs 398 in its research report dated January 31, 2019.

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March 04, 2019 / 15:50 IST

26 Aug, 2025 12:21

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Cholamandalam securities' research report on Hexaware Technologies

In 4QCY18, Hexaware reported a revenue growth of 3% QoQ (+3.4% QoQ in CC terms) to USD 176.1mn largely owing to the ramp up in deals won in the previous quarters. In INR terms, revenue grew by 3.5% QoQ to INR 12,524mn in-line with our estimates of INR 12,482mn. • EBITDA came in at INR 1,913mn, below our expectation of INR 2,012mn. Margins contracted by 140bps QoQ to 15.3% on account of impact of wage hikes (-60 bps) and furloughs during the quarter. PAT declined by 28.3% QoQ on account of forex losses.

Outlook

We introduce and rollover our valuations to CY2020E. At CMP, the stock is trading at P/E of14.7X/13.7x on CY19E/CY20E EPS, respectively. We have a BUY rating on the stock and arrive at a revised target price of INR 398 based on P/E of 16x CY20EPS.

For all recommendations report, click here