Moneycontrol PRO
Live Now |We’ve been digital since day one. Dell Technologies & Moneycontrol are using that experience to help small businesses upskill and upscale. Learn how you too can use that experience. Click Here

Buy Mphasis; target of Rs 1740: HDFC Securities

HDFC Securities is bullish on Mphasis has recommended buy rating on the stock with a target price of Rs 1740 in its research report dated January 23, 2021.

January 28, 2021 / 03:49 PM IST
  • bselive
  • nselive
Todays L/H

HDFC Securities' research report on Mphasis

We maintain BUY on Mphasis (MPHL), based on strong growth outlook in Direct International (85% of revenue) and despite the uncertainty around the diminishing DXC portfolio (13% of revenue). Key indicators for Direct International growth are (1) deal pipeline increase by 49% and 9MFY21 net new TCV growth of 68% YoY, (2) increase in large & integrated deal component and broad-based growth (T10 and >USD5mn accounts), (3) acceleration in sub-segments such as Europe geography and Direct-Hi-tech sub-vertical, and (4) recent wins expected to improve the growth prospects of Insurance vertical. Operating performance of MPHL remains consistent within its 15.5-16.5% EBIT band and presents an upward bias with levers such as offshore/utilisation.


MPHL’s valuation discount to mid-tier IT is expected to reduce, supported by an improving mix of high-growth Direct business, limiting the impact from DXC and on FCF yield >5%, ~30% RoIC, FY21-23E EPS CAGR at 16%. Our target price is Rs 1,740, valuing MPHL at 20x Dec-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.

Download your money calendar for 2022-23 here and keep your dates with your moneybox, investments, taxes

Broker Research
first published: Jan 28, 2021 03:49 pm
ISO 27001 - BSI Assurance Mark