Hold Accelya Solutions; target of Rs 1070: ICICI Direct

ICICI Direct's research report on Accelya Solutions

Accelya reported dismal Q1FY21 (June ending) results mainly led by exposure to airline sector. Revenues fell 5.1% QoQ, 46.7% YoY to Rs 59.2 crore mainly led by higher refund income in previous quarter. EBIT margins were at 3.4% vs. 4.5% in Q4FY20. Employee cost increased in the quarter due to restoration of salaries (compared to salary cuts in previous quarter). PAT declined 42.5% QoQ to Rs 2.0 crore mainly led by higher tax expenses. We have introduce FY23E estimates in the current quarter.

Outlook

Hence, we revise our target price downwards to Rs 1070/ share (17x FY23E EPS, 3.5x FY23E sales) and downgrade the stock from BUY to HOLD recommendation.