HEM Securities IPO report on Happiest Minds Technologies
Positioned as “Born Digital. Born Agile”, company focus on delivering a seamless digital experience to its customers. Company’s offerings include, among others, digital business, product engineering, infrastructure management and security services. Company’s capabilities provide end-to-end solution in the digital space. Company have developed a customer-centric focus that aims to fulfil their immediate business requirements and to provide them strategically viable, futuristic and transformative digital solutions. In Fiscal 2020, 96.9% of company’s revenues came from digital services which is one of the highest among Indian IT companies. According to Frost & Sullivan Report legacy IT market as a percentage of total technology spend is estimated to decline from 85.7% share in 2019 to 65% share by 2025, with digital spend making up the remaining 35% share by then.
Valuation and Outlook
Company is bringing the issue at p/e multiple of approx 12x at higher end of price band of Rs 165-166/share on post issue annualized Q1FY21 eps basis. . Company has shown strong growth in its financials in last couple of years. Company is strong brand in digital IT services with growing high revenue generating customer accounts with a high proportion of repeat revenues and revenues from mature markets .We like the scalable business model of company which has multiple drivers of steady growth with experienced leadership focused on sound corporate governance practices. Therefore, looking after all, we recommend “Subscribe” the issue both for short & long term horizon.
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