Buy Quess Corp: target of Rs 850: Sharekhan

Sharekhan's research report on Quess Corp

Quess’ workforce management business is well-placed to clock double-digit growth in the coming years as flexi-staffing gains prominence and India’s labour laws are simplified, providing growth levers. We expect the asset management business to post good growth in the coming years as the industrial cycle recovers. Revenues would clock a CAGR of 17% over FY2021-23. The management has maintained its target of achieving a 20% RoE through double-digit organic revenue growth, improvement in profitability through a better mix and efficiencies and growing PAT by reducing in interest cost (and sustained improvement in cash flows).

Outlook

We maintain a Buy on Quess Corp with a revised price target of Rs. 850. Strong growth potential of core staffing business, better cash flows and balance sheet, besides a focus on boosting return ratios will further re-rate valuations in the coming years.

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