eClerx Services share price hits 20% upper circuit as Q4 profit jumps

The company reported net margins at 20.89 percent in the March quarter. The board of directors have recommended a dividend of Re 1 per share for the full year.

According to a report by ICICI Direct research, eClerx is witnessing improving growth in customer care, RPA, analytics and content development. In addition, it could benefit from cross sell and up sell to Personiv clients. This, coupled with lower roll offs from one off client specific event, improving deal wins and revival in growth are expected to drive revenues. With this, coupled with higher revenues and margin assumption (compared to our previous estimates), we revise our
EPS estimates upwards.

"With reasonable valuationsand healthy balance sheet we maintain buy rating on the stock with a revised target price of Rs 1,640 (15x PE on FY23E EPS, earlier target price Rs 1,150)," it said.

The board of directors at its meeting held on June 10 recommended dividend of Re 1 per equity share of Rs 10 each for the financial year ended March 31, 2021, subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company, the company said in an exchange filing.

The stock was trading at Rs 1,617.35, up Rs 269.55, or 20.00 percent. It has touched a 52-week high of Rs 1,617.35. There were pending buy orders of 8,468 shares, with no sellers available.