Last Updated : Oct 26, 2020 03:46 PM IST | Source:

Buy Mphasis; target of Rs 1655: HDFC Securities

HDFC Securities is bullish on Mphasis has recommended buy rating on the stock with a target price of Rs 1655 in its research report dated October 23, 2020.

Broker Research
  • bselive
  • nselive
Todays L/H

HDFC Securities' research report on Mphasis

We maintain BUY on Mphasis (MPHL), following a strong 2Q performance and high growth visibility ahead. We are positive on MPHL, based on (1) large deal wins (TCV of USD 1bn+ TTM new deal wins with highest-ever TCV in 2Q), with the increasing deal size in NewGen/Digital wins and deal pipeline (+75% YoY) providing high growth visibility, (2) strong BFS portfolio driven by consolidation deals in large accounts as well as the mortgage segment, (3) services re-alignment, integrated deals (Apps, IMS, BPM) and the focus on hyperscaler partnerships have supported 3x growth in cloud deal pipeline (27% and 60% of cloud pipeline includes AWS/Azure channel), and (4) increased focus in Europe geography.


MPHL’s valuation discount to midtier IT is expected to reduce, supported by an improving mix of high-growth Direct business limiting the impact from DXC and on FCF yield >6%, ~30% RoIC, FY20-23E EPS CAGR at 14% (16.5% over FY21-23E). Our target price of Rs 1,655 is valued at 20x Sep-22E EPS.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

First Published on Oct 26, 2020 03:46 pm