Moneycontrol PRO
UPCOMING EVENT:Attend Traders Carnival Live. 3 days 12 sessions at Rs.1599/-, exclusive for Moneycontrol Pro subscribers. Register now!

Buy Mindtree target of Rs 4804: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Mindtree has recommended buy rating on the stock with a target price of Rs 4804 in its research report October 14, 2021.

October 14, 2021 / 02:07 PM IST
HDFC Securities research report's outlook and valuations:  500bps growth outperformance over FY21-24E as compared to 250bps earlier). We roll over valuations to Sepemtember-23E and increase target multiples for most of the companies in our coverage universe. We remain broadly constructive across the sector and ahead of consensus on growth/EPS; our preferred picks are Infosys, HCLT, Mphasis and Zensar."" title="HDFC Securities research report's outlook and valuations:  "The YTD EPS upgrades (consensus) have been led by mid-tiers such as Tata Elxis, Mindtree, Mastek, and Persistent Systems, ranging from 20-40 percent and, within tier 1, by Wipro (~15%). We expect the sector (coverage universe) to post 13 percent and 14.5 percent USD revenue/APAT CAGR over FY21-24E compared to 6.5/7.5 percent over the past five years. The mid-tier valuation premium relative to tier 1s may sustain, based on its relative outperformance (>500bps growth outperformance over FY21-24E as compared to 250bps earlier). We roll over valuations to Sepemtember-23E and increase target multiples for most of the companies in our coverage universe. We remain broadly constructive across the sector and ahead of consensus on growth/EPS; our preferred picks are Infosys, HCLT, Mphasis and Zensar."" width="100%" height="auto" >

HDFC Securities research report's outlook and valuations:  "The YTD EPS upgrades (consensus) have been led by mid-tiers such as Tata Elxis, Mindtree, Mastek, and Persistent Systems, ranging from 20-40 percent and, within tier 1, by Wipro (~15%). We expect the sector (coverage universe) to post 13 percent and 14.5 percent USD revenue/APAT CAGR over FY21-24E compared to 6.5/7.5 percent over the past five years. The mid-tier valuation premium relative to tier 1s may sustain, based on its relative outperformance (>500bps growth outperformance over FY21-24E as compared to 250bps earlier). We roll over valuations to Sepemtember-23E and increase target multiples for most of the companies in our coverage universe. We remain broadly constructive across the sector and ahead of consensus on growth/EPS; our preferred picks are Infosys, HCLT, Mphasis and Zensar."

 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Prabhudas Lilladher's research report on Mindtree


MTCL reported exceptionally strong beat in revenue (+450bps/+680bps above our/cons estimates) with 12.7% QoQ USD growth led by strong growth in RCM (+29.7% QoQ USD) partly aided by project backlogs as economies opened after extended lock down, especially in Europe region which also posted strong growth. (Continental Europe +14.7% QoQ USD). Rest of the verticals and markets also posted strong growth. Bulk of the growth was driven by Customer Success service line (+21.9% QoQ USD) which also indicates strong demand for adoption of technology for revenue maximization and this is only expected to increase with time. Deal TCV of $360 Mn grew 19% YoY but was bit soft compared to record high TCV of $504 Mn in 1Q22. Management mentioned that deal pipeline is strong with good mix of multi-year annuity and short-term digital transformation deals.


Outlook


We expect massive upgrades in consensus EPS estimates. We arrive at DCF based TP of INR 4804 (earlier: 4,593). MTCL is currently trading at 39/33.6X on earnings of INR 111.7/130.1 for FY22/23 respectively with Revenue/EPS CAGR of 21%/25% for FY21-24E.


For all recommendations report, click here


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.

 

Broker Research
first published: Oct 14, 2021 02:07 pm

stay updated

Get Daily News on your Browser
Sections
ISO 27001 - BSI Assurance Mark